Olympics power giant Aggreko in £2 billion-plus takeover talks

Aggreko, the Glasgow-headquartered temporary power group which employs several hundred staff in Scotland, is in talks with a private equity-led consortium over a possible £2.2 billion takeover deal.

Aggreko supplies temporary power and temperature control equipment to customers around the world.

In a stock market announcement, the company said it was in discussions over a potential cash offer for Aggreko at 880p a share, a 39 per cent premium to Thursday’s closing price.

Shares in the company were up by more than a third shortly after the news broke.

The consortium is fronted by private equity firm TDR Capital, which is also behind a recently announced deal to buy supermarket chain Asda, and US infrastructure fund I Squared Capital.

Aggreko, led by chief executive Chris Weston, said discussions with the consortium are ongoing.

“There can be no certainty either that an offer will be made or as to the terms on which any offer might be made,” it said.

Shares in Aggreko, one of Scotland’s largest and longest standing plcs, hit a high of almost 2,500p back in 2012 but have struggled in recent years.

In a trading update last month, it said it was sticking with guidance provided in November for annual group profit before tax in the range £170m to £190m. Full-year results for 2020 are due to be released on 1 March.

Aggreko recently said it was investing £4.5m to upgrade its production facility in a move that will bring together its three Dumbarton operations.

The project includes the acquisition of land at Lomondgate Park next to the firm’s existing site, which is owned by Strathleven Regeneration CIC.

Construction is already under way and represents an investment of £4m with local firms. It will bring more than 300 employees together in a “campus environment” which will add a rental depot to the existing manufacturing site.

At the start of January, the company confirmed that it had sealed a critical $315m (£231m) contract for this summer’s rejigged Olympics in Japan – now under threat again.

Other events utilising the company’s kit include Glastonbury and the Super Bowl.

Aggreko was founded in the Netherlands in 1962 and moved to Scotland in 1973. It was acquired by logistics group Christian Salvesen in 1984 before being demerged and listing on the stock exchange in 1997.

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