Sigma Advanced Systems Ltd announced on Tuesday its plans to acquire the British company Bromford Precision Solutions Ltd for an amount equivalent to 153 crore Indian rupees (11.89 million pounds sterling).
Expansion of Production Capacity
This deal is intended to strengthen Sigma's manufacturing capabilities in the aerospace industry and expand its participation in the global supply chain for aircraft engines. Bromford, founded in 1988 and based in Leicestershire, specializes in the production of high-precision rings for aircraft engines and other critical engine components.
Partnership and Deal Valuation
Bromford supplies components to clients in both the aerospace and energy sectors worldwide, holding approvals from Rolls-Royce and Siemens. Sigma plans to acquire Bromford at a valuation of approximately 4.6 times the projected annual operating profit (Ebitda). Sigma's management expects this acquisition to increase future profitability and create shareholder value.
Integration Strategy
The acquisition complements the capabilities of the company's UK subsidiary, Nasmyth Group, by expanding the product range within the Rolls-Royce supply chain and strengthening the manufacturing base. The combined entity will be able to offer a wider range of components for Original Equipment Manufacturers (OEMs) in the aerospace and energy sectors.
Optimization Plans
Sigma intends to increase Bromford's margin through the implementation of automation and capital investments. Furthermore, the company plans to relocate part of its production to India to reduce costs and deepen ties with current customers by entering into long-term supply agreements.
Management Comments and Timeline
Chief Executive Officer Sunil Kalidindi stated that this takeover strengthens Sigma's position in one of the most demanding aircraft engine supply chains globally. The company emphasized that the transaction aligns with its strategy of building a globally integrated platform for aerospace and defense manufacturing with operations in India and the UK. The deal is expected to close by the end of July, subject to standard closing conditions.