Firm that made anti-terror doors for the Bank of England (“Rhino Doors”) is first in Wales bought by investment firm Cyrus
- 18:04, 25 AUGUST 2015
- UPDATED 18:10, 26 AUGUST 2015
- BY SION BARRY
For source material please visit: http://www.walesonline.co.uk/business/business-news/firm-made-anti-terror-doors-9926778
Cyrus Investment Management is chaired by Welshman and former managing director of JP Morgan David Hitchcock
An investment company set up with the aim of acquiring precision engineering firms and providing them with finance to expand has executed its first deal in Wales, with its chairman saying it will be the first of many more to come.
Cyrus Investment Management, which is currently looking to raise £40m through an Enterprise Investment Scheme structured fund which closes next April, is chaired by Welshman and former managing director of JP Morgan David Hitchcock.
Following a successful pilot which raised £5m, the fund is targeting acquisitions among the 1,500 companies in the UK sector, many of which are family-owned and in need of fresh capital and support to achieve growth.
Plans for manufacturing hub
Ebbw Vale-born Mr Hitchcock, who also chairs Cardiff-based precision engineering firm Cyrus-RW Group, also has plans to create a manufacturing hub in Port Talbot with its own port to ship heavy components in and out, as well as setting up an apprenticeship school for precision engineering.
The Rhino Doors deal, when factoring in on-going working capital, is worth around £1m. The company, set up by three former British Steel engineers in the 1980s, makes security doors which can withstand terrorist attacks. Its doors can be found at the Bank of England and the Olympic Stadium in London.
Cyrus’s acquisition of Rhino has been backed with Welsh Government finance.
Mr Hitchcock said: “They are literally bursting out of their factory. They wanted to grow and came to us wanting a partner. I liked them very much and they were very honest as one of the three founders wanted to retire and they didn’t want any of their staff [currently 21] to be fired.
“They were turning down big export contracts as they couldn’t do the work. When they set up they had no idea how successful they would be. We have a facility which was the old Taylor’s & Sons site [a business Cyrus-RW acquired in 2008] four miles away in Briton Ferry.
“So we are going to bring Cyrus at Briton Ferry here [Cyrus-RW in Cardiff] and Rhino Doors will go into the factory, but at the same rent as in Port Talbot but in a bigger and better facility which we are refurbishing. The rest of the Briton Ferry site also has a triple shift cutting titanium.
“This is fabulous news for the Port Talbot area as you have a much stronger company behind these jobs and Rhino will be expanding with new showrooms going in. They will really be pumping and will soon be employing 40.”
Cyrus could execute eight £5m deals a year
Mr Hitchcock said the with the current fund raising and future funds, Cyrus Investment Management could potentially execute eight £5m deals a year, with its portfolio of companies employing 1,000 by 2020.
And as part of a longer-term strategy he has identified a seafront site in Port Talbot for a precision engineering hub, where companies backed by the fund, including those brought in from outside Wales, could co-locate.
He said: “I would love to build a big factory in West Wales. I have got a site in mind for a 100,000 sq ft facility, with an option to extend to 30,000 sq ft, where we could drop some of these companies [future acquisitions] into.
“It’s fabulous on the seafront so you could float out big bits of kit. I would love to do it. The Welsh Government are also very supportive. However, if you build something in Surrey for £12m the next minute it is worth £20m, but if you build something for £12m here [West Wales] and sadly it is immediately worth £6m so the grants just get you to the starting line, but I would like to build it and look back in 10 years and see we are turning over £200m to £300m.”
‘We’d like to get ex-soldiers involved’
Mr Hitchcock, a former captain in the Brigade of Gurkhas and who also served with the Royal Regiment of Wales in Northern Ireland, said: “We would also like to have our own apprenticeship training school and get ex-soldiers involved.”
Earlier this week the fund acquired out of administration Bristol-based City Engineering saving 31 jobs. And in another deal out of administration it acquired Yorkshire-based Bradford Cylinders last year.
The strategy is for the fund to also to provide centralised support to its portfolio of acquired firms and supporting them to break into new sectors.
On the Welsh Government Mr Hitchcock said: “We have a very positive relationship with the Welsh Government. We respect each other and can pick up the phone and talk at any time, which is not always the case with key decision makers in other parts of the UK.”