An engineering firm which aims to double turnover within three years and explore international opportunities said it can now execute its ambitious plans after being acquired in a deal worth £2.75m.
Agriculture, food and engineering group Carr’s Milling Industries has acquired North Shields-based Chirton Engineering, which makes equipment for the nuclear, oil and gas and renewable energy sectors.
Carr’s produces farm products and ingredients for the ready meal and baking industries and chief executive Tim Davies said the firm has been searching for a business to complement its own its engineering division.
As part of the deal – which was overseen by Square One Law and Tait Walker – Carr’s will acquire the entire share capital of Chirton for £2.75m and an additional £2.55m could become payable subject if certain conditions are met over the next five years.
Chirton Engineering Ltd was started by Paul Stewart just over 10 years ago in a 500sq ft unit with only four employees.
Since then it has established a global customer base, including IHC Merwede, Oceaneering, and Proserv Offshore and has recently expanded into component manufacturing for manufacturers including McLaren, as part of a strategy of collaborative innovation with its core customer base.
The 52-strong firm, based at West Chirton South Industrial Estate, will continue to be led by its existing management team, including managing director Paul Stewart.
Turnover last year reached £3.6m and seven months into the new financial year the firm is on target to achieve £5m in sales, with profit coming out at around 11% of that, and the plan is to take sales to £8m within three years.
Recent times has seen the business export to China, Singapore, the US and France but efforts are now being focused on Norway, where an order to the value of £300,000 was recently completed. Investment by Carr’s Engineering means further opportunities in Scandinavia can be built upon.
Paul Stewart said: “It’s been a long process to get here – five months of hard work – but I’m a very happy man.
“Ten and a half years ago four of us started out in a shed and we’ve now built it up to 52 employees. I wanted to push on with our burgeoning order book and Carr’s Engineering could come in and offer the financial support the business clearly needs to grow the plan I’ve put in place.”
Tim Davies, chief executive of Carr’s Milling, said: “Chirton is a really good fit for us. It’s a company that’s recognised widely as being an excellent business, particularly in terms of growth. It’s in the right area and has a great customer base and they are ready to grow further – and that’s where we come in.
“Chirton is undergoing significant growth, particularly internationally, and we can help him and his team to get to the size they need to be.
“Paul has fantastic opportunities with customers at home and abroad but he’s at the point where he’s got to find more cash and invest in more machines.With Carr’s strong balance sheet we can provide expertise, central support, strategic direction and finance.”
Square One Law senior partner Ian Gilthorpe added: “Square One Law and Tait Walker are delighted to have closely with Paul Stewart and the team at Chirton in delivering a project which will enable Chirton to continue its rapid growth.”