TI Group’s newly-formed Forsheda Polymer Engineering is planning to raid the £600m corporate acquisitions war chest in a bid to double in size by 2001.
The next major phase of expansion is expected to be announced this autumn, two years after TI bought Swedish supplier Forsheda the company that has given its name to the new TI business group.
This year’s big acquisition is expected to boost Forsheda’s business in the US, which accounted for only 20% of Forsheda Polymer Engineering’s £244m turn-over last year.
The company has been created as the so-called ‘fourth leg’ of the £1.8bn TI Group, which includes Dowty, Bundy, and John Crane.
Although it remains the smallest element it will be able to take advantage of the massive funds for acquisitions that TI has built up.
‘We will get as much of that as we need, provided the business case stands up,’ chief executive Clive Stearnes said.
On the world market, Forsheda Polymer Engineering takes 9% of sales, second only to Freudenberg which dominates with 30%.
Smaller players include Parker, Hutchinson, and Federal Mogul, each with 4-6%, with the remainder of the market fragmented.
‘We are only just appearing on the scene with any kind of critical mass. Before now we have been buried within John Crane,’ said Stearnes.
Forsheda Polymer Engineering has 5,000 staff in 41 sites, mainly in Europe and North America. Some 30% of its product is manufactured in the UK at three Dowty plants, Forsheda Industrial Gaskets, and Woodville Polymer Engineering.
The range is dominated by engineered seals, which make up 65% of sales.