Chequers, TCR sell Thermocoax to trade in €158m deal

Francesca Veronesi
18 February 2019

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Chequers Capital and TCR Capital have sold France-based Thermocoax Developpement, a heating technology specialist, to UK-based Spirax-Sarco Engineering.

Chequers, TCR and other minority shareholders have sold their stakes in the business for a cash-free, debt-free consideration of €158m.

Based in Cheltenham and with origins dating back to the 1880s, Spirax-Sarco Engineering specialises in the control and use of steam and electrical thermal energy products, in addition to peristaltic pumping and associated fluid path technologies.

The purchase will be funded from existing cash and debt facilities and is expected to be accretive to group earnings in 2019.

Thermocoax will become part of Spirax-Sarco Engineering's electrical process heating division Chromalox. Spirax-Sarco also intends to pursue the expansion of Thermocoax in the US.

Previous funding
Advent International initially completed the carve-out of Thermocoax from Phillips Electronics in 1998. Two years later, Chequers backed the management buyout of the company, gaining a 75% shareholding. Subsequently, TCR acquired 85% of the firm in 2005, for an estimated €35m.

Chequers Capital purchased a 60% stake in Thermocoax from TCR in 2010, while TCR retained a 30% stake in the business through its TCR Capital Partners II fund, which closed in 2008 on €161m. The sale saw TCR reap an estimated 5x on its 2005 investment, Unquote reported at the time.

The remaining 10% of the shares were owned by the management team.

Company
Founded in 1957, Thermocoax is a designer and manufacturer of electrical thermal products for critical applications. Its core technology is mineral insulated cable, which comprises single- or multiple-conductor wires insulated by magnesium oxide, all enclosed within a tubular metal sheath.

The company serves several industries including the nuclear, aeronautic, defense and aerospace sectors.

In 2018, Thermocoax recorded revenues of €49.8m, posting an EBITDA of €12.9m. According to a statement, 54% of the company's revenues originate in EMEA, 32% in the Americas and 14% in Asia Pacific. Headquartered in Suresnes, the business has manufacturing facilities in France, the US and Germany.

People
Spirax-Sarco Engineering - Nicholas Anderson (CEO).