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Hampson back on the takeover trail again.

West Midlands aerospace and engineering group Hampson Industries was back on the takeover trail yesterday - snapping up US firm Composite Horizons (CHI) in a pounds 12 million deal which will give it access to important new military projects.

Hampson, which has its headquarters in Brierley Hill, announced the move yesterday as it posted an 82 per cent jump in pretax profits, up from pounds 688,000 to pounds 1.25 million for the six months to September 30.

Turnover climbed 49 per cent, up from pounds 45.5 million to pounds 67.9 million, while operating profits were up 87 per cent, from pounds 1.9 million to pounds 3.6 million.

Earnings per share rose four per cent, from 0.89p to 0.93p. However, there is no interim dividend payment.

Chairman Tony Gilroy told shareholders: "The first six months represent another period of solid achievement for the group, with strong growth from aerospace and a strengthened order book in automotive.

"The group continues to focus on generating value for our shareholders through investment in growth programmes in our continuing businesses and by securing enhanced positions in niche, high growth, high margin areas that complement our existing capabilities and customer base."

Hampson, which employs a 1,600-strong workforce - with 400 at plants in Birmingham, Leicester and Alcester, also announced an underwritten vendor placing of 7.75 million new shares at a price of 153 pence each to raise pounds 11.8 million before expenses. The proceeds from the placement will partly fund the acquisition of Composite Horizons, which is based in Covina, California. The group said the balance will be satisfied through an extension of debt facilities.

Composite Horizons has more than 30 years of experience in the engineering, development and manufacture of complex geometry, advanced composite components.

The firm specialises in high temperature polymer composites, a niche technology primarily for high performance gas turbine engine applications and structural airframe components where greater strength and temperature resistance properties are required. Importantly, the acquisition also gives Hampson access to aerospace programmes such access to the was the F-35 Joint Strike Fighter - a joint project between the US and UK - the F22 Raptor warplane and the Boeing 777 airliner, where it was previously not well represented. Every F-35 built will be worth around $160,000 (pounds 81,600) to Hampson, while work on each Raptor and 777 is worth between $40,000 (pounds 20,400) and $50,000 (pounds 25,500).

The takeover also gives it an entry into a number of unmanned satellite and space programmes.

Meanwhile, Hampson intends to use another pounds 3 million of its enlarged debt facilities to fund investment into the expansion of its precision automotive division, which manufactures components for engine turbochargers. Earlier this month the firm officially opened its new manufacturing plant in Bangalore, India.

Shares closed up 5.75 at 161p.
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Publication:The Birmingham Post (England)
Date:Dec 2, 2006
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