GKN Wheels & Structures, which employs hundreds of people at its plant at the Hadley Castle Works, is to be sold to Aurelius for an undisclosed sum.
The plant manufactures off-highway wheels for the agricultural, construction, mining, material handling, forestry and industrial sectors.
The transaction is expected to complete in November and the change in ownership is subject to regulatory approval.
In the coming months, Aurelius said it will support GKN Wheels & Structures in executing its carve-out from GKN, ensuring continuity in the company’s day-to-day operations, to establish the business under a new brand name and as a standalone entity.
Going forward, Aurelius will work with the existing management team to continue delivering the company’s business plan.
Matthias Täubl, member of the executive board of Aurelius, said: “This is an exciting acquisition for Aurelius and provides us with a strong platform for future growth in the off-highway wheels manufacturing sector. We look forward to building on the good work of the GKN Wheels and Structures management team and working with them to ensure a smooth transition in the coming months.”
Dr Dirk Markus, CEO of Aurelius Group, added: “This acquisition is another example of Aurelius’s strength in acquiring non-core divisions of large corporates and successfully executing these complex transactions. As a global market leader with a strong and committed customer base, GKN Wheels & Structures is well-positioned for future growth under Aurelius’s ownership.”
GKN Wheels & Structures employs about 900 people worldwide with four manufacturing facilities in the UK, USA and Denmark in addition to test centres in Italy and the USA. In 2019 it generated global sales of over £170 million.
Abdul Butt, CEO of GKN Wheels & Structures, said: “This change in ownership means that we have a focused owner. Our clear and tailored approach enabled us to meet the needs and demand of each of the industry sectors in which we operate, delivering the right products for the right applications, at the right time. This approach won’t change, and we remain committed to delivering our business growth plans and putting our customers and employees at the heart of everything that we do.”
It was recently announced the results of GKN Wheels’ multi-million pound investment programme in its Telford manufacturing facility are now being realised.
Despite a number of obstacles, not least the impact coronavirus pandemic has had on the plant’s operational capabilities, the new manufacturing plant is now producing more than three times as many wheels as the old plant, with 55 off-highway wheels now being manufactured every hour.
With the new line now fully operational, the old lines and assembly cells have now been decommissioned and disposed of.
The scale of the change to the factory is enormous, with virtually all that remains of the production plant from two years ago being the structure of the building. The entire production line has been completely re-built, with new rim lines, robotic weld cells and a state-of-the-art finishing plant.
Mike Smith, plant director at Telford, added: “Building on the recently completed multi-million pound investment programme in our Telford plant, our manufacturing facilities will benefit from the commitment and focus of Aurelius, which will enable us to further strengthen our market-leading position in the wheels industry. Together with Aurelius, we are determined to provide world class, technology-leading products, solutions and services to the off highway and automotive markets, building on our proud manufacturing heritage and the undoubted experience and expertise of our people.”
In 2018 GKN was taken over by turnaround specialist Melrose.
Its victory brought to a close a bitter battle that had raged for months, with unions and MPs warning over job cuts, asset-stripping and national security concerns throughout the takeover saga.