US firm Cincinnati Milacron last week completed its exit from the machine tool sector with the sale of its machine tool business to Beverly Hills-based Unova for $178m (£110m) in cash.
The acquisition will give Unova a machine tool business with a $1.4bn turnover.
Cincinnati Milacron’s machine tool division has two plants: one in Birmingham, UK, and another in Cincinnati, Ohio, where it has a workforce of 1,700.
The Birmingham plant has 570 employees and occupies a 24,000 sq m site. Turnover for the UK operation is expected to exceed £100m this year, with about 75% of production being exported. It produces vertical machining centres and the Hawk lathe and has no direct competitor within the Unova group.
‘We will continue to operate as before,’ said John Bloxham, managing director of the UK business. ‘Planned investments will continue with our £3m capital budget remaining unchanged.’
Cincinnati Milacron will change its name to Milacron and concentrate on plastics technologies and industrial products for metalworking. The remaining business will have a turnover of $1.6bn.
The machine tool business, which is to be renamed Cincinnati Machine, will be a separate Unova division under the existing management.
Unova, formed in October last year when it was spun off from Western Atlas, is keen to expand its manufacturing systems activities into the non-automotive sector. It owns Michigan-based Industrial Automation Systems, and two UK machine tool businesses, Landis Lund and Lamb Technicon (UK).
The machine tool industry has suffered from thin margins recently and Unova will be hoping to benefit from economies of scale.
Bloxham said the group would aim to make savings in the cost of materials. He added that cross-selling should also bring benefits.