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Revealed: Latest BGF investment gives Durham engineering company £6m boost

County Durham-based Altec Engineering has become the latest company to secure investment from BGF (Business Growth Fund), receiving a £6m investment to support its buy and build strategy and organic growth..

The engineering solutions provider designs and manufactures special purpose equipment and manufactures high precision CNC components for the automotive, aerospace, mining, defence and oil & gas sectors. The first investment is the acquisition of neighbouring business Ronco Engineering.

Altec is led by an experienced team and its major shareholder is Alastair Waite who acquired a majority stake in the business from his father Ron, who founded the company in 1978. Over the past three years revenues have doubled through organic growth and the acquisition of Yorkshire based Sigma Technologies in November 2014.

Ronco Engineering is a precision engineering company based in Tanfield Lea, County Durham. Founded in 1992, it provides CNC manufactured parts to customers such as Caterpillar and JCB.

Together, Ronco, Sigma and Altec employ around 140 people the majority of whom are experienced and skilled engineers, toolmakers and design staff. Altec has an enviable reputation in the training of apprentices and has eleven apprentices in training with three new starters in September.

Altec Engineering plans to scale-up its business through accelerating its organic growth plans following the expansion and investment into its Durham site last year; the delivery of new value-added services such as specialist coatings and through further strategic acquisitions.

The business has also made a number of Board appointments including David Bailey, former vice president of Parker Hannifin Europe, to the role of non-executive chairman following an introduction made by BGF. Simon McIntosh joins as Group Financial Director and Barry Jackson joins the board of the company on behalf of BGF.

This is BGF’s sixth investment in North-east based businesses and 20th investment in the North of England. It follows recent investments in Tyneside-based Broadband Satellite Services and Teesside-based Chemoxy. Set up in 2011, BGF is now the UK’s most active provider of growth capital to small and mid-sized businesses.

Alastair Waite, Altec Engineering said: “Altec was successful in obtaining funding from FW Capital last year which enabled us to grow the business to the stage where BGF could support us further. BGF’s investment has already helped us to move forward with our growth plans through the acquisition of Ronco - a solid business that shares our ethos around engineering quality and building long-standing relationships with customers.

“We have spent time getting to know the team at BGF. Their minority investor approach is completely aligned with our desire to have a supportive partner who is prepared to stand back from the day-to-day running of the business.”

Richard Taylor, BGF said: “Altec has a great team delivering excellent results. Alastair has a track record in executing buy and build strategies and has a pipeline of opportunities that, with our investment, will help the business scale quickly.

“This is BGF’s sixth investment in the North-east, taking our total investment in the region to over £40m. This is testament to the growing confidence of businesses located here to pursue growth after a sustained period of underinvestment.

“Due to a number of high-quality investment opportunities in the pipeline as well as a growing portfolio, we are also recruiting to build the BGF team across the North.”

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