General Motors agrees sale of Millbrook Proving GroundOct 21, 2013
The acquisition by private equity house Rutland Partners is due to complete early in December and will result in major investment in Millbrook’s facilities and service offer.
General Motors, parent company of Luton-based Vauxhall, will remain a key customer but has decided to sell in line with concentrating its engineering activity on larger regional centres.
Vauxhall chairman and nanaging director Duncan Aldred said: “This is a good day for General Motors and the employees of Millbrook. The acquisition of Millbrook Proving Ground by Rutland Partners is a very positive move for both businesses.
"GM’s strategic objective is to focus its global engineering facilities on larger regional centres and in Rutland we have found a strong partner to take over the UK engineering operation.”
Millbrook’s chief executive Miguel Fragoso will remain at the helm. Rutland plans to appoint John Notman-Watt, who has 25 years’ experience in the testing, inspection and certification sector, as executive chairman once the acquisition is completed.
GM’s subsidiaries, including Vauxhall, Chevrolet and Adam Opel AG, will remain a key customer of the business with both parties entering into a number of long-term supply agreements.
Mr Fragoso said: “This transaction is a very positive and exciting time for Millbrook, its employees and clients moving forward as it will secure access to funds and strategic resources to support investing in people, technology and growth.
“Millbrook will grow its technological capability to continue delivering excellence to all its clients and strategic partners. Furthermore, the agreement marks an unprecedented milestone for Millbrook to embark on a growth plan addressing market opportunities in the UK and overseas.”
The Millbrook acquisition is the 11th investment by Rutland, which has also invested in Pizza Hut UK Restaurants, office furniture company AFI Group, online retailer Buy As You View and food manufacturer Bernard Matthews.
In the past 18 months it has returned more than £200 million to investors after exiting four businesses.
Successful business relationships developed with customers other than General Motors now account for most of Millbrook’s test and engineering revenues.
They will accelerate this growth in the future, aided in part by the expansion of facilities and by help from Rutland to invest further in and expand its service proposition.
Rutland’s investment director David Wardrop said: “Millbrook is a unique asset operating in a number of attractive markets driven by tightening regulations notably in fuel emissions and vehicle safety.
"The business has a strong reputation within the markets it serves and we are excited to support the team and invest further in the business as it transitions away from its current ownership and develops into an independent test and engineering business.”
Opened in 1969, Millbrook has developed into one of Europe’s leading test and engineering solution providers for the automotive, energy and defence markets. Its 665-acre site contains more than 45 miles of test tracks and extensive test and validation facilities. The business is also a leading convertor of specialist vehicles.
Current turonover is around £40 million and the business employs more than 400 staff.
Mr Aldred said: “Rutland’s acquisition is wholly positive. It secures Millbrook’s future, enables further investment in its facilities and important third party business and protects its employees. It also supports the UK government’s drive to encourage more young engineers to join this thriving business sector.”