Caledonia Regulatory News (CLDN)

Caledonia Investments plc

CALEDONIA INVESTMENTS PLC ACQUIRES PORTFOLIO OF FIVE US INDUSTRIAL BUSINESSES FROM LATSHAW ENTERPRISES, INC.

Caledonia Investments plc ("Caledonia"), an investment trust company listed on the London Stock Exchange, and Nova Capital Management Ltd ("Nova"), the specialist acquirer of corporate and private equity portfolios, are pleased to announce that they have completed the acquisition of five industrial businesses in the USA. The acquired businesses comprised all of the operating subsidiaries of Latshaw Enterprises, Inc., a US based industrial group.

Equity financing for the acquisition was provided by Caledonia and Nova. Caledonia has invested USD 42 million in cash at completion. GSO Capital Partners (part of the Blackstone Group) and PNC Bank provided the debt financing.

The five acquired businesses have aggregate sales of approximately USD 90 million and employ more than 450 people in five operating facilities across the USA.

The businesses acquired are:

• Wescon Products Company, an OEM manufacturer of mechanical controls, cable assemblies and screw machined components primarily for the lawn & garden sector, based in Wichita, Kansas;

• Wescon Plastics LLC, a manufacturer of custom plastic injection moulded parts using highly-engineered resins primarily for the battery and heavy duty truck industries, based in Wichita, Kansas;

• MC Electronics Inc, which specializes in the assembly of custom electronic cables, harnesses, electro-mechanical assemblies and full system integration, based in Hollister, California;

• Coast Wire & Plastic Tech Inc, a manufacturer of custom electronic wire and cable products, for the medical, instrumentation and commercial electronic industries, based in Carson, California; and,

• Anderson & Forrester Inc, a manufacturer of orifices, fittings and gauging tools for the natural gas and propane industries, based in Wheat Ridge, Colorado.

Duncan Johnson of Caledonia commented: "The underlying businesses of Latshaw Enterprises are each established manufacturing operations enjoying strong positions in attractive markets. The businesses are cash generative and our investment has been structured so as to provide a running yield from year one. Along with Nova and the Latshaw team we have developed an investment strategy which will see capital value being built and realised over the medium term.

This is the third portfolio acquisition that Caledonia has funded with Nova. Following the success of the first two investments, we are delighted to be working with the Nova team once again. "

Caledonia was advised by Macfarlanes LLP and Catalysis Advisory. Latshaw was advised by Husch Blackwell LLP and William Blair & Company LLC.

01 October 2012

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Notes for editors:

Caledonia Investments plc

Caledonia is a self-managed investment trust company listed on the London Stock Exchange with net assets of approximately £1.1bn. The company maintains a concentrated portfolio of international quoted, unquoted and fund investments and has paid an increasing dividend for 45 years.

In the unquoted arena, Caledonia seeks to invest £20 to £50 million in private companies either on a majority or minority basis in situations where it believes there to be a good opportunity for building value over the longer term.

For additional information on Caledonia, please visit www.caledonia.com. Neither the contents of the company's website nor the contents of any website accessible from hyperlinks on the company's website (or any other website) is incorporated into, or forms part of, this announcement.

Nova Capital Management Ltd

Established in 2002, and with a 20 strong team, Nova has acquired or taken over the management of portfolios representing a total transactional value of over EUR 1.0 billion. Nova currently manages investments in over 25 businesses primarily operating in Western Europe and North America, across a broad range of sectors. 

For additional information on Nova Capital Management please go to www.nova-cap.com

Nova Capital Management Limited is regulated and authorised by the Financial Services Authority.