3i's Element bolts on Cascade TEK

JosУЉ Rojo
23 October 2015

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Element Materials Technology (EMT), a British materials testing business owned by listed GP 3i Group since 2010, has acquired US product qualification testing (PQT) specialist Cascade TEK.

The purchase, expected to complete on 1 November, was designed to strengthen EMT's footing within the US-based PQT segment.

The bolt-on is the third so far in 2015 for EMT and will drive the group's global laboratory network to 15 facilities. Earlier purchases this year include US-based Environ Laboratories and UK-based Trac Global, acquired in January and March 2015 respectively.

The add-ons followed acquisitions announced prior to 2015, such as Detroit Testing Laboratory, Accutek Testing Laboratory and Materials Engineering Research Laboratory.

The build-up flurry for EMT kicked off after 3i carved out the business from Candover-owned Dutch parent Stork for €150m in November 2010.

Two years after 3i's takeover, the listed GP supported a $93.25m restructuring, with fresh debt coming from a syndicate of seven banks. This was compounded by an additional financing package provided by EMT's lenders in August 2013.

A third refinancing took place in August 2014, when a $325m covenant-lite structure was put in place to finance EMT's buy-and-build plans. The restructuring saw 3i and its associated funds reap approximately £51m in returns.

Company
Founded in 1992, Cascade TEK is an environment product tester for the A2LA standard, which also manufactures laboratory and vacuum ovens used for drying purposes. Headquartered in Longmont, the company employs a 27-strong workforce and most recently generated $8m in revenues.

Having spun out from Candover-backed Dutch parent Stork in 2010, EMT specialises in material testing and inspection services. The company manages a network of 15 laboratories where tests are run for clients within the aerospace, oil & gas and transportation industries, among others. With current headquarters in London, the business employs 1,800 professionals and generates revenues in excess of $250m.

People
Charles Noall is EMT's current CEO, while Terry Candlish holds the same position at Cascade TEK.