Severfield may have to pay up to £25m eventually, depending on how Harry Peers performs by the back end of 2020.
With Harry Peer’s strengths in the petrochemicals, process and power sectors, the acquisition takes Severfield into new and complementary markets, including nuclear decommissioning.
For the 12 months to 30th April 2019, Harry Peers made a pre-tax profit of £3.4m on revenue of £21.2m. The value of its gross assets at year-end was £24.0m.
The board of Severfield sees the long-term investment profile of Harry Peers’ customer base in regulated markets broadening its market exposure.
Severfield chief executive Alan Dunsmore said: “This acquisition will help Severfield continue to deliver on its strategic objectives. Harry Peers’s experience in specialist, highly regulated, non-cyclical markets will enhance our future growth plans through expanding the group’s capabilities and sector reach.
“We believe Severfield is best placed to help Harry Peers continue its profitable growth trajectory, through increased scale and investment and together with Harry Peers’s strong management team we have a real opportunity to develop a broader position within the UK structural steel services market.”