American Axle takeover puts Albion into premier league

US firm American Axle & Manufacturing (AAM), which this week took over Glasgow-based Albion Automotive, is expected to seek a stock market listing shortly. Such a move would boost Albion’s expansion plans, which include winning further work with car makers. The combined group will have a turnover of £1.4bn and produce parts for cars, pick-ups […]

US firm American Axle & Manufacturing (AAM), which this week took over Glasgow-based Albion Automotive, is expected to seek a stock market listing shortly.

Such a move would boost Albion’s expansion plans, which include winning further work with car makers.

The combined group will have a turnover of £1.4bn and produce parts for cars, pick-ups and trucks.

Albion, which was formed under a management buy-out from the collapsed Daf Trucks in 1993, is now 100% owned by AAM following its acquisition for an undisclosed sum.

Albion has 1,150 employees. Its turnover was £78.4m for the year to 31 March.

Albion’s existing management team will remain. Jim Hastie will continue as chief executive but will report to Mike Straney, AAM’s new vice-president Europe who is moving to Glasgow. All three of Albion’s non-executive directors have now stepped down.

Hastie said the company would be maintained as a wholly owned subsidiary within AAM. It will continue to be run independently and retain its name.

Albion has three manufacturing plants: in Glagow’s Scotstoun, and at Spurrier and Farington in Lancashire. The firm makes front and rear axles, driving heads, crankshafts, chassis components and transmission parts mainly for trucks and buses. It is about to supply crankshafts to Rover and already supplies Perkins.

AAM was formed in 1994 by CEO Richard Dauch and two investors through a management buy in of General Motors’ driveline, prop shaft and forging unit. It has 8,500 employees and factories in Michigan and New York in the US and Ontario, Canada. It had a turnover of £1.33bn in 1997 and is building a plant in Mexico.

AAM has been looking to acquire another niche player for some time, and Albion is its first acquisition.

AAM makes a range of automotive systems and components for car derived products (pick-ups and four by fours) including rear and front axles, steering and suspension components.

An Albion spokesman said the two firms’ product lines are complementary.