Castle Support Services to be sold for £127m
Who?
Castle Support Services, the Birmingham-based electro-mechanical inspection, maintenance, and repair services business.
Did what?
Accepted an offer from Sulzer UK.
How much?
Sulzer is to pay 108 pence for each Castle share, valuing the company at £127m.
What does this mean?
Christopher Mills, chairman of Castle, said: "We are pleased to have secured this cash offer of 108 pence per Castle share which provides our shareholders with an exit from their investment at a significant premium over the value of their shares prior to the commencement of the offer period. The Castle board unanimously recommends that shareholders accept this offer.”
Who advised?
Rothschild is financial adviser to Sulzer. Strand Hanson is financial adviser to Castle.
Insider comment:
The sale will come shortly after Castle's subsidiary, Dowding & Mills, completed the sale of its calibration division to Trescal for £6.5m in cash. At the time, Castle said the money would be used to improve Dowding's position in the marketplace.
On 18 May we reported that Castle was in talks with more than one party about selling its business. Swiss-based Sulzer appears to have won and will pay £127.5m for the pleasure of owning the business. Sulzer operates in over 120 locations worldwide and specialises in the manufacture of industrial machinery and equipment, surface technology and rotating equipment maintenance, operating through four divisions (Sulzer Pumps, Sulzer Metco, Sulzer Chemtech and Sulzer Turbo Services). The group's key markets are the oil and gas, hydrocarbon processing, power generation, pulp and paper, aviation and automotive industries.
Castle has accepted an offer that, according to the chairman, shareholders believe is a "fair and reasonable value for their Castle Shares against a difficult and uncertain global economic trading environment".
Ton Büchner, chief executive of Sulzer, said: "The intended combination of Castle with Sulzer Turbo Services will create a leading independent provider of maintenance and repair services for turbomachinery, generators and motors with a broader service offering. This will further strengthen the relationship with the shared customer base as well as with potential new customers."
Ton Büchner, chief executive of Sulzer, said: "The intended combination of Castle with Sulzer Turbo Services will create a leading independent provider of maintenance and repair services for turbomachinery, generators and motors with a broader service offering. This will further strengthen the relationship with the shared customer base as well as with potential new customers."
