Spectris accepts £3.8bn takeover provide from personal fairness group

Advent International is set to win the race to buy British scientific instruments maker Spectris after the two companies struck a £3.8billion takeover deal.

The private equity firm has agreed to pay the FTSE 250 group’s shareholders £37.63 per share in cash, including a 28p per share interim dividend, the pair said on Monday.

Spectris told shareholders earlier this month it was ‘minded to accept’ a £3.7billion offer from Advent, which owns British defence giants Cobham and Ultra Electronics.

But a few days later, it revealed it had rejected two rival proposals from New York-based investment firm Kohlberg Kravis Roberts (KKR).

Advent said Spectris was ‘well-placed to capitalise on future growth opportunities in its core end markets’ following a major restructuring undertaken by the group since 2018.

This has included raising £1.3billion of capital through selling eight businesses as part of a portfolio rationalisation and investing in its two divisions, Spectris Scientific and Spectris Dynamics.

Agreement: Advent International is set to win the race to buy scientific instruments maker Spectris after the two companies struck a £3.8billion takeover deal

Mark Williamson, chairman of Spectris, said: ‘The Spectris management team have transformed the Spectris Group into a leading, sustainable business with high-quality premium precision measurement solutions.

‘The board remains confident in Spectris’ strategy and the opportunities that will be delivered over the medium term, but believes that Advent’s offer recognises the attractiveness of Spectris and represents strong and immediate cash value for shareholders.’

Spectris produces high-tech instruments, test equipment and software for industrial applications, including oxygen sensors for ventilators, portable gas analysers, and particle measuring systems.

It was originally founded as the Fairey Aviation Company in 1915 by Richard Fairey to manufacture seaplanes.

The group was acquired by educational publisher Pearson in 1980, underwent a management buyout in 1987, and was listed on the London Stock Exchange the following year.

It adopted its current name in 2001 after purchasing four instrumentation and process monitoring businesses belonging to the German firm Spectris.

Should Advent eventually snap up Spectris, it would represent the biggest takeover of a London-listed company this year.

The deal would also constitute another blow to the London markets, which have lost multiple major firms to foreign predators taking advantage of discounted valuations in recent years.

High-profile deals have included Thoma Bravo’s acquisition of cybersecurity specialist Darktrace, Carlsberg’s purchase of Robinsons squash maker Britvic, and EP Group’s takeover of Royal Mail’s parent company, International Distribution Services.

And just in the past two months, there have been takeover agreements for takeaway giant Deliveroo, Northern Irish software developer FD Technologies, chip designer Alphawave, and consultancy business Ricardo.

KKR and Stonepeak Partners put forward multiple offers for Assura, but the NHS landlord informed investors on Monday that it had backed a rival £1.8billion proposal from Primary Health Properties.

Russ Mould, investment director at AJ Bell, said: ‘The fact we’ve got two bid battles in Spectris and Assura just goes to show how the UK stock market continues to be on sale.

‘If investors don’t recognise the good value opportunities on offer, trade buyers or private equity firms will keep swooping on targets and pick them off one by one.’