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LONDON - Senior plc (LSE:SNR) has reached a binding agreement to sell its Aerostructures business to UK-based private equity investor Sullivan Street Partners for an enterprise value of up to £200 million, the company announced Friday.
The transaction, which represents 13.1 times Aerostructures’ 2024 EBITDA, includes an initial consideration of £150 million and potential additional payments of up to £50 million in the first half of 2026, contingent on the business’s 2025 performance.
Senior expects to receive approximately £100 million in upfront net cash proceeds before transaction costs of around £12 million. The company plans to use these proceeds to reduce debt and fund a £40 million share buyback program upon completion.
Following the divestiture, Senior will transform into a pure-play fluid conveyance and thermal management business with 19 operating businesses across 10 countries. The company expects the transaction to immediately improve its adjusted operating profit margin and return on capital employed.
"This transaction successfully positions Senior as a market-leading pure-play fluid conveyance and thermal management business, delivering in line with our strategy," said David Squires, Chief Executive of Senior.
The Aerostructures business, which manufactures precision-machined airframe and aero engine components, contributed £272 million in revenue and an operating loss of £6.5 million to the Group in 2024. It comprises five operating businesses across seven sites in the US, UK, Thailand and Malaysia, employing approximately 1,800 people.
After the sale, Senior has set medium-term financial targets including double-digit adjusted operating margins, cash conversion greater than 85%, and return on capital employed of 15-20%.
The transaction is expected to complete by the end of 2025, subject to regulatory approvals and other customary conditions, according to the press release statement.
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