Equity funding is helping County Durham-based Altec Engineering pursue growth through acquisitions, overseas expansion and diversification. CEO Alastair Waite explains how partnering with BGF means access to money and support, without loss of control.
My father, Ron Waite MBE, founded Altec Engineering in 1978. The business manufactures special purpose equipment and high precision CNC components for the automotive; aerospace; mining; defence, and oil and gas sectors.
I had been involved in building a very successful IT business but decided, after 15 years, I wanted to do something different.
I developed some ideas about how we could grow Altec and pitched this to the executive directors who supported the plan.
As an engineering firm headquartered in the North East, we’ve been through our fair share of market upturns and downturns. Like many small and midsized businesses in the UK, we’ve faced challenges with access to skills, funding and support too.
So we’re fortunate that a focus on strong customer relationships, continued investment in apprenticeship programmes and good routes to market has stood us in good stead, and the business has a solid foundation.
But we knew there was more that we could do to increase our revenues and profitability. We wanted to export more; invest more; innovate more, and improve our training facilities for staff.
We began our ambitious growth plan by extending our main facility at Durham, increasing the floor space by 75%, and completely reorganising our CNC machining facility at the same time as adding new production offices and quality departments.
We also invested in 3D printing capabilities, which have been instrumental in helping us to secure new contracts.
Alongside this, we acquired Sigma Technologies which brought further capabilities to our offering, including stock build programmes; inventory control; kitting, and integrated MRP.
Then, in July 2015, and to accelerate our growth even further, we took a £6m growth capital investment from equity provider BGF (Business Growth Fund).
Visit www.bgf.co.uk to find out more
Their minority investor approach is completely aligned with our desire to have a supportive partner who is prepared to stand back from the day-today running of the business.
Following the investment, we made our second acquisition: Ronco Engineering, a precision engineering company based in County Durham which provides CNC manufactured parts to customers such as Caterpillar and JCB, and shares our ethos around engineering quality and building long-standing relationships with customers.
We also acquired a further 10,000 sqft factory space adjacent to our existing facilities to meet future investment plans and house a specialist training area.
The future for Altec is incredibly exciting. With BGF’s financial backing, we are now exploring further strategic acquisitions, as well as the delivery of new value added services such as specialist coatings