Bodycote Plc, the largest thermal processing services provider, has announced that it has acquired the heat treatment business of Curtiss-Wright Corporation for a total consideration of US$ 52 million.
The group operating in Aerospace, Defence and Energy business expects the acquisition to exceed the group's cost of capital and enhance earnings in the first year.
In the twelve months to December 2011, the business delivered EBIT of US$ 7.7 million on sales of US$ 36.5 million and the business comprises of nine sites in Northern and Central USA serving a wide range of industries but with a particular focus on commercial aerospace and oil & gas (34 percent of sales). It also features some key automotive accounts (20 percent of sales).
"We are delighted to be acquiring this heat treatment business, which fits extremely well with our existing organization and our overall strategy. Adding these nine sites to Bodycote's existing 35 US plants provides significant additional capability and a broader customer base in key regions. The acquisition includes three sites in Wichita, Kansas providing Bodycote with a major presence in this strategically important aerospace industry hub. The facility in Lafayette, Louisiana provides access to the buoyant oil & gas market in this part of the United States, while the five northern plants fit well with Bodycote's automotive and general industrial network, enhancing service to existing customers and extending our geographic coverage," said Stephen Harris, CEO of Bodycote while commenting on the acquisition.
The group's strategy is aimed at growing the business above and beyond the background growth rate of the global economy while delivering consistently superior value. The pace of execution of this strategy is gaining momentum and the group enters 2012 in good shape.
The macroeconomic environment may continue to be challenging, but with nearly half of the group's activity in areas which have long term growth drivers that are less likely to be impacted by economic headwinds it believes there is a good prospect that the business will continue to move forward in the coming year.