Birmingham-based Metalrax, the niche supplier of specialist engineering and consumer durable products, has acquired Post Glover Lifelink for £3 million in cash.

For the year to the end of March last year, Kentucky-based PGL, a maker of isolated electrical power systems and electrical raceways - bought from Halma - reported revenues of £3 million.

Performance for the current year indicates encouraging levels of growth, Metalrax said.

Metalrax said the deal was in line with its strategy "to supplement organic growth through selective acquisitions of complementary technologies and companies that operate in niche markets, have significant growth potential and barriers to entry and can each be expected to contribute meaningful profits".

It is immediately earnings enhancing and has been funded from Metalrax's existing cash and debt facilities.

PGL works for the medical, laboratory and educational sectors.

The company, which has been owned by Halma since 1979, employs 24 people and is the number two supplier in each of its primary product markets.

The existing management team will all remain with the business following completion.

Andrew Richardson, chief executive of Metalrax, said: "The acquisition of PGL marks our first step in supplementing Metalrax's turnaround potential and organic growth prospects.

"As well as enhancing Metalrax's existing markets, the acquisition of PGL takes the group further into the healthcare, medical, laboratory and educational sectors where we are well placed to grow organically and through selective acquisitions."

Mr Richardson, just three months or so into the job, has been imposing a drastic shake-up on the Birmingham engineering conglomerate.

Casualties have included the Bacol Fine Blanking factory in Bromsgrove and finance director William Kelly.

Bacol employed 170 people but was said to be losing £200,000 a month.

Mr Kelly, finance director for the past two years, quit earlier this month by mutual consent. Five senior managers have left Metalrax since Mr Richardson took charge on October 15. Six others have been appointed.

The closure of the Bacol factory is part of a strategy to withdraw from high-volume, low-value components for the motor industry. That will also involve closing Metalrax's operation in Sibiu, Romania, where Metal-rax owns a site worth some £9 million.

Mr Richardson is reorganising Metalrax into two divisions - specialist engineering and consumer durables.

The specialist engineering subsidiaries, with a turnover of £90 million a year, will concentrate on niche markets where there are high barriers to entry. Examples are airport baggage handling equipment made by Down & Francis in Kings Norton and Toolspec, which supplies assemblies to JCB and other makers of construction vehicles.

The consumer durables wing, previously known as housewares, will seek to exploit a portfolio of valuable brands. It has opened offices in China and Hong Kong, but will keep a factory and warehouse in the UK to meet sudden demand from retailers.