Motherwell Bridge powers ahead with £75m disposal of information systems division

Deal estalishes platform for major growth in nerw century

Leading engineering group Motherwell Bridge is powering ahead into the new century following the £75m. sale of its Information Systems division in an institutional buy-out led by Europe’s leading venture capital company 3i.

The sale represents a massive return on investment for Motherwell Bridge which acquired the origins of the Information Systems division only six years ago for £400,000 and has invested £9m. in developing the operation worldwide.

Following its initial acquisition Motherwell Bridge has developed the Information Systems division through organic growth and a series of shrewd acquisitions, building turnover to £44m. in the current year.

Over the last few years Motherwell Bridge has fundamentally reshaped its engineering businesses. It has substantially reduced capacity in its operations which are subject to cyclical demand in supplying capital plant and equipment to the process plant industries. This business will account for less than 10% of the group’s turnover this year. At the same time it has expanded its engineering maintenance services activities and increased its exposure both by acquisition and organically to higher added value sectors such as aerospace, nuclear plant maintenance and decommissioning and railtrack maintenance. These activities provide the opportunity for future sustainable growth in earnings.

Motherwell Bridge group chief executive John Lumsden, who has been closely involved in the development of the Information Systems division, said: “This sale represents a fitting conclusion to a century of achievement for Motherwell Bridge. In little more than six years we have grown the Information Systems division from a small player into one of the UK’s leading IT solutions businesses with interests in three continents and employing over 700 staff."

“We believed, however, that the business had reached a stage where it had the potential with further investment to become a major international player. In addition we have opportunities to grow our engineering activities and the combined investment to fully develop both business streams would have demanded more investment than could prudently be provided. This transaction by strengthening our balance sheet and releasing funds creates a very strong platform from which to expand in our target sectors."

“We have made major investment over the last two years to refocus our business and concentrate on a number of key sectors. Our strategy for growth is in place for expanding our interests and continuing the success of Motherwell Bridge in the new millennium.”

During the past year, Motherwell Bridge has made acquisitions in businesses involved in railtrack maintenance, nuclear engineering and aerospace, signalling its intention to expand its engineering knowledge and expertise into new growth sectors.

The group also recently unveiled a £10m. investment programme to expand its aerospace manufacturing operation. The programme involved significant new investment at Motherwell, strengthening its existing aerospace operation in Cumbernauld and the acquisition of Lucas Aerospace’s manufacturing plant in Burnley.

After the disposal, Motherwell Bridge will employ more than 3,500 people worldwide with a turnover of £200m. in its engineering businesses.

The Group has worldwide expertise in engineering and engineering services. Today Motherwell Bridge is known worldwide for its services to clients in a wide range of fields, including energy, aerospace, chemicals, pharmaceuticals, steel and transportation.