Arlington Capital acquires Firth Rixson

Katharine Hidalgo
03 December 2019

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US-based Arlington Capital has acquired aerospace parts manufacturer Firth Rixson from New York-based Arconic.

The firm typically invests $25m-75m in companies with enterprise values of $50-500m and is currently investing from its $1.7bn Arlington Capital Partners V vehicle.

In November 2019, Arlington acquired rings, forgings and metal products manufacturer Doncasters Group's Blaenavon Forging business. The business will combine with Firth Rixson under the name Forged Solutions Group. The combined company will operate five manufacturing facilities and will act as a platform for further acquisitions to be supported by Arlington.

In February 2019, Pittsburgh-based automotive and aerospace company Arconic announced its intention to separate into two businesses, engineered products and forging, and global rolled products. It planned to sell any business that did not fit into those focus areas. The company was under pressure from activist investor Elliott Management, according to Unquote sister publication Mergermarket.

Previous funding
The Carlyle Group and Lehman Brothers backed the take-private of Firth Rixson in 2003. The transaction gave it an enterprise value of approximately £106m. Bank of Scotland provided debt facilities in support of the offer.

Oak Hill Capital Partners acquired the company from Carlyle and Lehman Brothers in a £945m deal in 2007. Lehman Brothers retained a minority stake in the business alongside management and Oak Hill acquired approximately 75% of shares. The transaction was supported by a senior and mezzanine debt package of almost £600m provided by Lehman Brothers, GE Commercial Finance and Lloyds TSB Corporate Markets.

In 2009, Oak Hill and other shareholders agreed to inject £100m in fresh equity to repay part of the company's £450m senior debt, while some of the funding was used to support the company's capital expenditure.

Oak Hill sold the company to aluminium manufacturer Alcoa for £1.7bn in 2014 and Arconic acquired the company from Alcoa in 2016.

Company
Founded in 1837 and headquartered in Sheffield, Firth Rixson is a provider of closed-die forgings and forged discs. The company reported a loss of £5.7m in 2018, down from profits of £12.7m in 2017.

People
Arlington Capital – Peter Manos (managing partner); Erica Son (vice-president).
Firth Rixson – Ben McIvor (general manager).