Shares in McKechnie were among the strongest performers in the FTSE 250 index last week after the company announced the £55.2m acquisition of a US aerospace components distributor.
The acquisition of Arger, of Nevada, which supplies 13 of the top 15 world airlines with a range of metal and plastic aircraft engine components, including replacements for the high-tech bolts used in aircraft manufacture, is McKechnie’s largest purchase to date. McKechnie shares jumped more than 6%, closing up 33p at 550p on news of the deal.
The company already makes aerospace fasteners and bearings, but the acquisition of Arger and Jesse, a small, related manufacturing outfit, gives McKechnie a leg-up in the after-market for aerospace components.
The two businesses produced profits of £7.1m on turnover of £27.9m last year. Net assets to be acquired will be at least £5m, subject to a final audit.
Chief executive Andrew Walker said: ‘These businesses are highly complementary to our existing aerospace businesses as they provide outstanding engineering expertise and direct access to a top quality customer list.’
The company said the acquisition would boost the design, development and manufacture of parts through McKechnie’s components businesses, Valley Todeco and Linread Northbridge.
Walker said that the Arger/Jesse management team would remain and would benefit other parts of the group, including Dzus, with Quick Release Fasteners, which already has a significant aerospace business.
The acquisition comes just over a month after McKechnie delighted the City with better-than-expected half-year results.
The company said at the time it had about £100m to spend on bolt-on acquisitions in the core areas of specialist fasteners and engineering plastics.