Speculation over who could become the new owners of Renishaw has begun, with few commenting that a deal could make at least one its two founders a billionaire.
For Sir David McMurtry, who founded the business with his former Rolls Royce colleague John Deer in 1973, this will not be a new experience – The Sunday Times Rich list had him at £1.29 billion in 2019.
When the announcement came on Tuesday, 2 March, 2021, the Wotton-under-Edge headquartered firm’s share price rose, pushing Sir David’s 36.2pc stake to £1.82bn and Mr Deer’s 16.6pc holding to £834m.
Reports say that Renishaw is currently valued at £5.05 billion pounds.
The pair’s joint statement on their intention to sell made no mention of money –stressing instead their objective of find the ‘right new owner’ for Renishaw, which has 2,200 staff in Gloucestershire.
And speculation that has followed has focused on not just who that new owner could be – and the difficulties around achieving a lasting legacy.
Paul Nurden, divisional director, Brewin Dolphin, which has offices in Cheltenham, said: ‘This is obviously very early days, but given the intention to retain the innovative culture, this likely precludes traditional private equity from being the right suitor.
‘So, it is most probably going to be a strategic buyer that has some value to gain from its product portfolio and R&D advantage.
‘In terms of names you could be thinking along the lines of ABB, Siemens or similar. While having a global footprint, Renishaw has operations in Gloucestershire on the manufacturing side which will likely continue to be a key asset for a strategic buyer.’
According to the Financial Times, US industrial conglomerate Danaher and Sweden’s Hexagon are ‘possible purchasers’.
Bristol-based Hargreaves Lansdown suggested that with the pair’s pledge to seek ‘the right buyer’ for their 53 per cent stake in the FTSE 250 business ‘might turn out to be a lengthy process’.
‘Crucially it seems they want a buyer which commits to the communities in which it operates. It has manufacturing bases not just in Gloucestershire, where the company is headquartered, but also in Cardiff and York as well as plants in Ireland, India Germany and the USA.
‘But, as we’ve seen in previous take overs in the past, pledges can be reneged on.
‘Despite best intentions there is always a risk that could happen which is likely to mean there will be a highly concerted effort to find the right buyer at the right price.
‘Renishaw’s shares have already more than doubled in a year and any potential match will have to meet a pretty hefty price tag to scoop the deal.’
As for the money, it is hard to know what either Mr Deer, 83, or Sir David, 80, thinks of such wealth, but if that was their only goal, they could have cashed in a long time ago.
Despite owning the incredible Swinhay House in the North Nibley, as featured in television’s Sherlock Holmes, Sir David has chosen to live more modestly, with his past cars being listed as a Mini and more recently a VW.
He is a man driven certainly by engineering challenges, with more than 200 patents to his name and too many honours to mention – one of the most recent being the James Watt International Gold Medal, given to an eminent engineer.
Read more: An end of an era as Gloucestershire engineering legend Renishaw goes up for sale
By Andrew Merrell
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