US firm turns up hear on £129m Aga deal
British upmarket cooker firm Aga Rangemaster is being snapped up by a US company in a deal valuing the group at £129m.
The maker of the distinctive cast-iron ovens has agreed to a 185p-a-share offer by American kitchen equipment firm Middleby a month after it first disclosed talks over a takeover.
Middleby moved to allay concerns over the future of Aga’s UK manufacturing operations, saying it “recognises the importance of Aga’s presence in the United Kingdom and intends to maintain Aga’s manufacturing operations in the UK”.
Swedish Nobel Prize-winning physicist Gustaf Dalen built the first Aga in 1922 and manufacturing was under way in the Midlands seven years later. The ovens are now built in Coalbrookdale, Shropshire.
Middleby plans to carry out a strategic review of the business following completion of the deal, which is expected later this year.
“Until such review is completed, Middleby has not made any firm decisions with regard to Aga’s business,” it said.
The takeover comes after Aga Rangemaster appointed advisers Rothschild to help assess “development opportunities” for the business at the start of this year.
Shareholders will see a 77% premium added to their stock compared to its value the day before talks were first confirmed in June.
Selim Bassoul, chairman and chief executive of Illinois-based Middleby, said the deal would “further strengthen Middleby’s global reach and enhance our position as a leader in the premium segment for residential kitchen equipment”.
Aga chief executive William McGrath said: “Aga will be the European platform for Middleby and our cookers will be sold through Middleby distribution channels, which will increase our growth rates in North America and in other international markets.
“We believe Middleby will build on our progress to date and successfully develop our iconic and unique brands for the future.”
Aga maker Allied Iron Founders was bought by Midlands-based engineering firm Glynwed in 1969. The Aga part of the business was split from the rest of the company in 2001.
Over the years the oven acquired a place in British popular culture, featuring in The Archers as well as romance novels that became known as “Aga sagas”.
Aga posted pre-tax profits of £700,000 for 2014, down from £1.1 million in 2013, as revenues rose to £261.5 million from £250.4 million.
The group, which also owns the Fired Earth tiles brand, has been increasing its international footprint and recently began sales in China after spending more than two years gaining the right accreditations.
It launched formally in Beijing in March.