Lloyds TSB Development Capital has backed the management buy-out of engineering group Deritend from GTIE, the French engineering and electrical services group.
Barclays Acquisition Finance Midlands provided debt facilities for the deal which was believed to have been in the range of £10m.
The new group managing director, Richard Hale, heads the management team along with co-directors Gordon Bridges and Ian Davis.
The Deritend Group provides a range of engineering services, including asset management and preventative maintenance. The group’s three niche businesses are in high voltage coil manufacturing, induction heating and aviation windings. Deritend has clients in a number of sectors such as automotive, water, metals and food.
Hale, who has been with Deritend for more than eight years, said: “The opportunities of the buy-out will allow us to be more proactive in developing closer relationships with our customers. Using modern maintenance techniques together with our extensive facilities and expertise, we will broaden our offering to the client ensuring that all their maintenance needs can be satisfied within the group.”
Deritend forcasts increased growth with the introduction of the UK climate change levy in April 2001. The levy is a tax on the use of energy in industry, commerce and the public sector that comes with offsetting cuts in employers' national insurance contributions as well as additional support for energy efficiency schemes and renewable sources of energy. It is a key part of the UK government's overall climate change programme and it is estimated that it will cost manufacturers £1bn in the next 12 months. Improvements in machine efficiencies will assist companies in reducing both costs and manufacturing downtime.
John Handley, head of Lloyds Development Capital’s Birmingham office said that continued pressure on UK manufacturing would result in a change in the market dynamics of asset maintenance. “Increasingly companies are outsourcing their requirements enabling them to focus on core activities, improve manufacturing efficiencies and competitiveness. Deritend are very well positioned to take advantage of these changes,” he said.