Severfield buys Dutch steelwork contractor for £21m

Aaron Morby 1 year ago
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Severfield has swooped to buy Dutch constructional steelwork contractor Voortman Steel Construction for €24m.

Voortman Steel Construction is well invested with modern production facilities, generating output of c.15,000 tonnes per annum
Voortman Steel Construction is well invested with modern production facilities, generating output of c.15,000 tonnes per annum

The deal will give Severfield a strong platform to secure work across Europe outside of its core UK market.

The £65m turnover business is headquartered in Rijssen and employs over 250 staff. Last year it reported a pre-tax profit of £1m.

Alan Dunsmore, chief executive officer at Severfield, said that combining the businesses would enhance Severfield’s position as one of Europe’s most diverse structural steel services groups.

It opens up opportunities for Severfield, which has a production capacity of 130,000t, to access to the fast-growing Dutch electricity distribution market.

This market has high barriers to entry and the current low-carbon energy transition trend is driving demand for upgrading and expanding the electricity network in the Netherlands and in other EU countries over the next ten years. 

VSCH is also one of the few providers of design and build solutions for simpler structures in the Netherlands.

Dunsmore said there was an opportunity to significantly grow this business in Europe, which is currently in its infancy, serving SMEs and smaller projects.

This would add new capabilities to the Severfield offering and opened up an attractive new market, providing opportunities for growth in the UK as well, he said.

“We believe that the combination of Severfield and VSCH will result in a broadening of our service offering and an ability to grow in different sectors and geographies.

“Not only is the acquisition of VSCH anticipated to be earnings enhancing in its first full year of ownership, the transaction will further cement our position in a growing European market and provide opportunities for further profitable growth.”

Voortman Steel Construction is co-located with Voortman Steel Machinery Holding, a manufacturer of steel fabrication machinery.

The acquisition will allow for areas of future collaboration with VSMH including the development of ‘robot’ production technology, proprietary fabrication software and bespoke equipment.  

The take-over deal is expected to complete in early April.

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