The acquisition from administration of North Yorkshire based Burdon Limited continues Express Engineering’s expansion and saves 76 North east jobs.
The manufacturing equipment at the Stokesley Industrial Estate factory has also been bought and will be used to expand services and reduce lead times to existing Express customers. It is hoped the Burdon customer base can also be retained.
Also within the deal comes a virtually completed, freehold, 25.000 sq. ft. factory, which will be finished to accommodate further expansion of the Stokesley operations, resulting in more skilled jobs.
Burdon Ltd. was established over 40 years ago and was most recently providing precision engineering services to the industrial, defence, automotive, aerospace and oil and gas industries – the latter two being key markets for Express Engineering.
The deal comes during a year in which Express celebrates 40 years in business. When added to the recent buy-out of Petrotec Components in Brazil, from joint venture partner Brastec Technologies, it increases the global workforce to over 375 – the majority of whom work at the Team Valley sites.
Nigel Davison, Managing Director, said: “We have enjoyed strong growth over recent years and we were looking for ways to increase capacity. Burdon operated in a very similar field and so we saw a great opportunity to accelerate our expansion, taking on good people with the right skills.
“We quickly reached agreement on a purchase which we see as a good deal for both businesses. It will help us to fulfil our exciting growth plans while securing jobs and key engineering skills, which could otherwise have been lost. I would like to thank all those involved in the negotiations – particularly the bank for an extremely swift and positive response – for their assistance in enabling a speedy agreement.”
Iain Oates, Managing Director with Burdon, said: “This is fantastic news for our people and our business which has some exciting new opportunities with new customers on the horizon. Unfortunately, an unexpectedly protracted refinancing process created a cash flow problem at Burdon which threatened to put all this at risk. Express stepping in means we can continue to develop these opportunities – particularly with aerospace and plant sector customers.”
Joint administrators, Hunter Kelly and Charles Young, of EY (Ernst and Young LLP), were advised by Walker Morris. Express’ advisors were pwc, Muckle LLP and Ward Hadaway. Lloyds Bank Commercial Banking provided funding for the acquisition.
Andrew Hopper, Relationship Director for Lloyds Bank Commercial Banking in the North East and North Cumbria, said: “Express is a long-standing client of Lloyds Bank and when they needed to move quickly to fulfil this acquisition, we were able to put funding that they needed in place in less than 24 hours.
“The need for this level of flexibility and responsiveness was key to ensuring Express was able to complete the deal and it signifies our commitment to them in our role as their long-term partner for growth.”
Hunter Kelly at EY commented: “Due to the cashflow dynamics it was necessary to reach a quick agreement and I am pleased we have achieved this, not only saving 76 jobs in the region but also providing a great opportunity for Express to build upon and expand Burdon’s capabilities.”