GCA Altium advises on £100m cross-border acquisition of Welshpool Manufacturing Business

The Manchester and Tokyo teams of GCA have advised Japanese listed manufacturer Sumitomo Heavy Industries (SHI) on the £100m acquisition of South Wales-based Invertek Drives.

This is the seventh time that GCA has advised SHI and the second cross-border transaction involving the European team, GCA Altium, following SHI’s €172m acquisition of Italian motor manufacturer Lafert in 2018.

SHI is a Tokyo Stock Exchange listed manufacturer and distributor of power transmission and control equipment under the Sumitomo Drive Technologies brand. Its current strategy is to further strengthen and expand its business by integrating new technologies in the areas of electric motors and frequency drives and achieving global growth in target segments such as robotics and positioning, transportation and logistics and food and beverages. As part of this strategy, last year’s acquisition of the Lafert Group expanded its business in terms of portfolio and global market reach.

Founded in 1998, Invertek designs, manufactures and distributes variable frequency drives used to control motors across a wide range of industrial, commercial and energy saving applications. From its headquarters in Welshpool, Wales, Invertek services an extensive global customer base in over 80 countries, and opened a new manufacturing and distribution facility adjacent to its existing site in January 2019 to expand its capability. The business also has dedicated sales offices across nine jurisdictions, including the USA, China, Germany, Spain, Poland, Czech Republic, Singapore and Malaysia.

Invertek’s technology and production capabilities will allow SHI to extend its product portfolio in the motor control industry, which is becoming increasingly important as demand for IoT automation, labour productivity and energy-saving technology grows. Its combination with Lafert’s motor technology will enable SHI to respond to the advanced needs of the customer, as SHI aims to create an integrated platform centred in Europe.

This transaction demonstrates GCA’s strong cross-border capabilities and broad global coverage with teams from the Tokyo and Manchester offices working together to achieve the strategic acquisition on behalf of SHI. The Manchester team comprised Phil Adams, Paul Lines, Andy Battersby and Gabby Worrall.

Phil Adams, Chief Executive of GCA Altium, said: 

“This transaction further underlines the global nature of our business following the merger with GCA in 2016. It has been a real honour and pleasure to support the SHI team. Advising our clients on repeat transactions and building trusted long-term relationships underpins our business.”

Shaun Dean, Vice President, Sumitomo Heavy Industries, Ltd., said:

“The seamless collaboration across GCA’s Tokyo and Manchester teams played a crucial role in getting this transaction across the line and in finding the ideal strategic partner for SHI to expand its global footprint. GCA’s ability to bring the cultures of Japan and UK together naturally was invaluable in this transaction. Invertek offers a route into a lucrative UK motor control market, and we are confident that the enlarged group will continue to thrive over the coming years.”

The transaction is expected to complete in early November.

Giles Elliott, Will McDonald and Charlie Peacock of Jones Day provided legal advice, while Will Oxley and Ben Ferguson of PwC provided financial due diligence services.