Hampson Industries is expanding strategically in the US with two aerospace acquisitions in California costing a total £61.2 million.
Hampson is paying $56 million up front for Coast Composites, a private company making precision tooling systems to produce big composite structures for aerospace, defence and satellite communications.
Kim Ward, Hampson's chief executive, expects the acquisition to enable Hampson to take advantage for increasing demand for such specialist tooling as the aerospace industry steps up its use of composites.
The smaller acquisition, Lamsco West, costing $56 million, specialises in sophisticated laminated aerospace parts known as shims. Alongside the existing subsidiary Attewells in Southall, west of London, Mr Ward hopes Lamsco will make Hampson a global leader in this niche market.
" Our aim is to make Hampson large enough not to be affected by any one customer in any one market," Mr Ward said.
"Coast gets us into programmes earlier. With Lamsco we are trying to create a world leader in shims. We are trying to add value."
Hampson is raising £32.5 million towards the cost of the deal by a placing of
161.9 million new shares at 21p, fully underwritten by Arbuthnot Securities. At the same time, it has arranged a £80 million secured multicurrency revolving credit facility with the Bank of Scotland and Lloyds TSB.
Hampson intends to consolidate its shares so that shareholders will get one new share for every five existing shares. Mr Ward hopes this will improve their liquidity, narrow the bid/offer spread and reduce the volatility caused by relatively small dealing on a "penny" share.
Yesterday the existing shares slipped 3/4p to 240p.
The acquisitions need shareholders' approval to be sought at a special meeting in Birmingham on December 15.
"These acquisitions demonstrate just how serious Hampson is in delivering on its growth aspirations," said David Stevenson, a partner in Eversheds' corporate group in Birmingham, which acted for Hampson in the share issue and bank facility.
"Following on from the successful Texstars' deal in December, 2004, the acquisition of Coast Composites should enable the group to benefit from favourable demand conditions for precision tooling systems whilst at the same time magnifying its exposure to the more general trend towards increased use of composite materials in airframe manufacturers."
Mr Ward said that these would not involve redundancies.