A team of industrial manufacturing specialists have established a new business, SE-TEK Ltd, after completing a Management Buy Out (MBO) of Komatsu Mining’s UK conveyor manufacturing operation.
SE-TEK will continue to operate from a 200,000 sq ft manufacturing facility in Sunderland, which the business has operated out of for the past 13 years, with an existing workforce of around 100, with plans to increase headcount as the business expands into new geographical markets and product areas.
The business manufactures and supplies conveyor components and spare parts to Original Equipment Manufacturers’ (OEMs) for the on-site transportation and processing of products in the aggregates, mining, tunnelling and construction sectors.
Also providing fabrication services, SE-TEK will continue the business’ considerable domestic and export activity working with an established customer base.
Supported by a significant seven-figure funding package and working capital facilities from Close Brothers Invoice Finance, the MBO has been triggered by Komatsu’s strategy to exit from the conveying segment and divest its UK conveying business.
The business will be led by CEO Giles Richell, along with a senior management team of four others, three of whom are established employees of Komatsu and have been running the Komatsu Sunderland Manufacturing facility.
Russ Richardson becomes Operations Director; Martin Townsend is the business’ Finance Director and Neil Fairley becomes Supply & Quality Director. Completing the senior management team is Chris Stavers who will join SE-TEK from Chirton Engineering as Sales Director.
Advising the management team on this complex MBO was Newcastle-based RG Corporate Finance (RGCF), led by Partner and Head of CF, Carl Swansbury, CF Senior Manager Alex Simpson and CF Executive Tom Cosby.
Tax advice was provided by RG Business Tax Partner and Head of Business Tax, Simon Whiteside, Director of Taxation Services, Simon Hopwood and Business Tax Assistant, Harry Lamb.
Legal advice to the management team was provided by commercial law firm Square One Law, led by Head of Corporate Mark Lazenby, Corporate Partner, John Hammill, Property Partner, Michael Shuker and Employment Partner, Eleanor Wilkinson.
Funding was provided by Rob Hatfield of Close Brothers Invoice Finance.
Providing external legal advice to Komatsu was Minter Ellison.
Giles Richell, CEO of SE-TEK, said: “The conveyor operation is well-established and has an international reputation, which provides SE-TEK with a platform to grow our already strong client base in new and existing markets.
“In addition to maintaining continuity of quality and supply to customers, we are particularly pleased to be able to retain this operation in the North East, utilising a highly-skilled and dedicated workforce, which we are confident we can grow as we secure additional projects.”
Diego Damiani, Vice-President of Business Development at Komatsu, said: “Following a thorough process to identify the best opportunities for the UK Conveying manufacturing division outside of Komatsu, we are confident that SE-TEK is ideally placed to provide a sustainable future and we’re pleased to conclude this transaction with the new owners.”
Carl Swansbury, Partner and Head of Corporate Finance at RGCF, said: “This manufacturing operation has been a key part of the North East’s industrial landscape for many years and, as a result of this MBO, will secure its presence in the region and provide a springboard for future growth. The experience and expertise Giles and the senior management team bring to the business will not only give confidence to the existing customer base, but also provide the impetus to take its products and capabilities into new sectors.”
Mark Lazenby, Head of Corporate at Square One Law, said: “The facility in Sunderland has become synonymous worldwide with the production and supply of industrial conveying components and under the new ownership of SE-TEK will continue to be an impressive contributor to North East exports. It is a prime example of the manufacturing expertise that exists in this region with real growth potential, which will generate additional employment opportunities for skilled people.”