The business was acquired from Bluewater Thermal Solutions LLC (Bluewater), for US$68 million. Bodycote has not acquired any interest in the remaining ten facilities owned by Bluewater in the Great Lakes region of the USA.
Most of CCHT’s business serves general industry in the Carolinas, Georgia, Alabama and Tennessee, including some customers in off-road vehicle and heavy truck manufacturing and a growing presence in aerospace and energy markets (around 15% of sales). Sales to the car and light truck sectors represent approximately 23% of the business.
“The acquisition of this pre-eminent heat treatment business in the Southeastern USA and Southern Indiana represents a considerable step forward in the delivery of Bodycote’s strategy in North America,” said Stephen Harris, CEO of Bodycote. “The business is of high quality and has few local competitors. This region of the USA continues to be amongst the highest recipients of inward investment in North America with many domestic and overseas corporations establishing facilities and supply chains in the area.
“The recent announcements from both Boeing and Airbus concerning their new manufacturing operations in the region underscore this trend," Harris added. "We expect the business to become more focused on aerospace and energy markets over time as the supply chains for these industries expand."
According to Harris, the acquisition also represents the first meaningful exposure for Bodycote to the off-road vehicle and heavy truck market in the USA. While demand from these particular sectors is expected to be lower in the near term, he said the medium and longer term prospects for this part of the business offer attractive returns.
