Finance For Enterprise (FFE) has provided £250k of funding to DINH Ltd to support the acquisition of AAP Metal Fabrication Services Ltd.
Based in Jarrow, Tyne & Wear, AAP was established in 2009 and provides bespoke metal fabrication services with particular expertise in the Subsea, Offshore and renewables sectors. The acquisition will see the current AAP directors retire with immediate effect.
The DINH purchasers are Gordon Watt and Jeremy McLeod-MacKenzie, who are both qualified accountants and experienced business owners. They already jointly own three other UK businesses involved in engineering and metal fabrication.
The strategic fit of acquiring AAP is strong due to the buyers’ existing business, Washington Waterjet Ltd (WWJ), being located in the same area.
The intention is for AAP’s general manager to take over the day-to-day operations with support from Terry Hall who is MD of WWJ and will also become the Managing Director of AAP. Jeremy McLeod-MacKenzie will provide FD and strategic support to both businesses.
Commenting on the acquisition, Jeremy McLeod-MacKenzie said “AAP has developed a strong reputation for supporting local clients with innovative solutions in a timely manner. This has resulted in the development of a loyal customer base that considers AAP a critical supplier. There is still huge potential to extend AAP’s geographical reach and continue its development and growth, with focus to date having been on their local marketplace.”
Two new jobs are anticipated to be created based on the increasing revenue in the business. These are expected within the next 12 months.
Commenting on behalf of FFE, Neil Wade, Senior Business Lending Manager said, “We are delighted to have supported two entrepreneurs to complete the acquisition of their fourth engineering business. In doing so, the deal has helped to protect and create new jobs in an area that currently suffers higher than average levels of unemployment. (ONS Feb 2024)”
This deal represents the first deployment of FFE’s new £25m facility recently announced as part of the £62m CIEF funding provided by Lloyds Bank and Big City Capital.
The deal was introduced to FFE by Pegasus Funding Solutions. The remainder of the funding for the deal has been provided by a combination of cash, invoice finance and deferred consideration.
