Background

Westek Technology Limited completed its multi-million pound sale to AIM-listed specialist services and engineering group, TP Group plc. Westek, whose headquarters are in Wiltshire, is a leading provider of rugged, high-performance computer servers and ancillary equipment for military and industrial customers mainly in the UK, Europe and the United States.

The acquisition of Westek was a strategic addition for TP Group, with proven capability in the design and manufacture of advanced electronic systems, providing specialist high-performance products. It also offered vertical integration with TP Group’s packaged equipment offerings.

Action

The deal concluded a seven-month competitive process, during which FRP worked closely with Westek directors to market the business for sale, and secure interest from major engineering firms in the UK and Europe. The complexities of the Westek deal required a deep knowledge of the market both here, and in Europe and the US.

We needed to find a home for Westek within the right larger business, one that would enable it to flourish by increasing production capacity and addressing an enormous sales backlog opportunity. We also had to take into account operational synergies, culture, size and any existing trading relationship with the UK and overseas Defence departments.

Using FRP’s ‘best in class’ in-house research function we were able to identify a pool of domestic and overseas buyers who met the requirements, which resulted in a competitive process among the bidders, ultimately driving a premium valuation for the business. This was the most significant transaction for TP Group and they undertook very detailed financial and legal due diligence. We guided the directors and legal advisers through each step of negotiations to ensure that a deal was agreed.

Outcome

The deal brought the backing of AIM-listed TP Group to Westek, and delivered a successful exit for the shareholders, who achieved their pre-sale objectives. The acquisition of Westek added a profitable business with new product lines, capabilities and customers to TP Group’s existing technology and engineering business stream.