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Venture capital firm rescues troubled ICS group

01 September, 2000

Venture capital firm rescues troubled ICS group

The Industrial Control Services (ICS) group - which includes Triplex, Transmitton and Max Controls - has been bought by a Tritrex, a company set up for the purpose by the venture capital company Alchemy. A majority of ICS shareholders has agreed to accept Tritex`s offer of just 1p per share, valuing the group at £1.7m. In 1997, ICS shares topped the 125p mark and, as recently as February, were trading at over 30p.

The ICS shareholders agreed to the offer after the group`s board warned that without a takeover, there was "a substantial risk that ICS would be unable to continue to trade solvently". ICS was "entirely dependent" on the continuing support of its banks, said the board, adding that it was not confident that this support would remain without an offer. By the end of June, ICS` debt was running at £14.5m - some £2.3m more than in November 1999.

The ICS board - chaired by Trevor Wheatley, who also chairs Focus Dynamics and was previously chairman of Control Techniques - blamed ICS`s woes on a cutback in exploration and development activities by the oil and gas industries. These are key industries for Triplex, which specialises in safety systems.

Following the acquisition, Tritrax is making £12.7m of additional financing available. It plans to restructure the ICS group "away from the demands of the public market". Tritrax adds that taking ICS out of public ownership will remove it from "the financial, managerial and regulatory burden of being a listed company".

Tritrax has appointed David Rimmer, a partner in Alchemy, as chairman of ICS. Alchemy specialises in acquiring poorly performing companies and hit the headlines earlier this year when it made an unsuccessful bid to buy the Rover group from BMW.

In a statement, Triplex says that the acquisition will give its customers and suppliers confidence in the future performance of the company by providing the financial strength to develop and expand the company. Triplex md, Glenn Cooper, says that new orders for safety systems from around the world will double the existing installed base of 11,000 critical I/O. "These systems are being delivered on time and under budget," he reports.

Triplex has manufacturing plants in Maldon in the UK and Houston in the US. The other ICS group members are UK-based Transmitton, which specialises in SCADA systems, and Max Control in the US which was previously the DCS division of Leeds and Northrup.

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