Acquisition of DGT

Smiths Group PLC 15 March 2004 News Release London, 15/03/04 For immediate release Smiths Group acquires US aerospace business for $102 million Smiths Group is extending its aerospace business activities in specialist aircraft engine component fabrication with the acquisition of Dynamic Gunver Technologies (DGT). Smiths Group has signed a binding agreement with DGT's owners to acquire DGT for $102m (£60m), payable in cash with funding from Smiths' existing borrowing facilities, subject to relevant regulatory approvals. ' This acquisition continues Smiths' strategy of growth in our major markets,' said Smiths chief executive, Keith Butler-Wheelhouse. 'We continue to seek excellent opportunities to strengthen our presence through investing in new technology and new businesses'. Commenting on this significant expansion in the business, Dr John Ferrie, group managing director of Smiths Aerospace said, 'DGT provides a strong complement to our existing engine components business. This acquisition enables us to realise customer and product synergies across the businesses. Offering complete engine sub-assembly modules will substantially increase the size of our addressable markets.' A privately owned manufacturer of aerospace turbine engine components headquartered in Manchester, Connecticut, DGT is an industry leader in complex metal fabrication and welding and laser machining and laser welding technology for aerospace applications, principally for US military engines. Examples of the direct synergies between the two companies include flap and seal assemblies provided by DGT. These complement fabrications currently manufactured by Smiths for engines powering F15 and F16 military aircraft as well as engines powering most commercial and regional jet aircraft. The business specialises in laser cutting, hydroforming, titanium hot sizing, electron beam welding, and complex multi axis machining. Smiths Group has market leading positions in aerospace systems, detection systems, medical devices, mechanical seals, and interconnect products. For further information, visit www.smiths-group.com - Ends - Contacts Business & Financial Press Bernard Carey +44 (0)20 8457 8403 Caroline Harris +44 (0)20 8457 8306 Trade & Technical Press Jennifer Villarreal +1 616 241 8643 Investor Relations Russell Plumley +44 (0)20 8457 8343 Notes to editors. DGT's turnover in the financial year ending December 31, 2003 was $110M. DGT's customers include most major engine prime contractors as well as the US Government. DGT has been a supplier to Pratt & Whitney for more than 30 years and is a preferred supplier to both Pratt & Whitney Aircraft and Pratt & Whitney Canada. DGT utilises a broad array of technologies to fabricate complex metal aircraft engine components. DGT specialises in thin wall hot section components made from exotic high temperature alloys and titanium. These families include combustors, flaps, seals and augmentor (afterburner) assemblies. DGT's capabilities will complement Smiths expertise in fabricating hot section products with high frequencies of replacement for large commercial and military engines. The headquarters facility is located in Manchester, Connecticut, with 4 satellite manufacturing facilities nearby The five buildings total 250,000 sq. ft. and the business has approximately 500 employees. DGT also holds a majority interest in a manufacturing business in Poland that could offer Smiths opportunities for lower-cost production and entries into other European programmes. Their owners, Howard Miller and Paul Polo, merged the two companies, Dynamic Metals and Gunver Manufacturing, respectively, in a leveraged recap sponsored by Jefferies Capital Partners in 1999. Gunver Manufacturing was founded in 1945 and Dynamic Metals was founded in 1963. Smiths Aerospace, a part of Smiths Group plc, is the leading transatlantic aerospace equipment company, with more than 9,000 staff and $1.6 billion revenues split between Europe and North America. The company holds key positions in the supply chains of all major military and civil aircraft and engine manufacturers and are world-leaders in electronic and mechanical systems, precision components and customer services. This information is provided by RNS The company news service from the London Stock Exchange
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