Handshake
Plastics manufacturing company, Carclo, has acquired Czech-based automotive design firm, FLTC, for £900,000 (approx. 27m CZK).
West-Yorkshire based Carclo produces fine tolerance, injection moulded plastic components, mainly for the medical sector, as well as designing and supplying specialised injection moulded LED-based lighting systems to the premium automotive industry through its subsidiary, Wipac Limited.
FLTC is an independent automotive design company based in Ostrava, Czech Republic and employs 35 designers, electronics and CAD engineers solely focussed on automotive LED lighting design.
FLTC has been a major supplier to Wipac, for the last three years and Wipac accounted for approximately one third of FLTC's sales in the year ended December 2016.
For the year ended 31 December 2016, FLTC reported unaudited turnover of CZK49.2 million (approximately £1.58 million), and unaudited profit before tax of CZK 11.5 million (approximately £380,000).
Carlco said it expects the acquisition of FLTC to result in a “modest improvement” in Group profitability in the first full year following completion, as a result of FLTC's lower cost base compared to Wipac's equivalent design resources in the UK.
The company also believes the acquisition will act as a further catalyst in its growth strategy for its Wipac LED lighting operations into both the low volume and mid volume prestige car markets.
"The acquisition of FLTC adds significant skills and capabilities to our Wipac business and will provide us with both an immediate step up in design capability as well as a base to further expand our design resources in the Czech Republic,” explained Chris Malley, CEO of Carlco.
“Whilst we have been expanding our UK based talent pool considerably over the last few years through a combination of recruitment and training, the rate of growth that we project at Wipac would have been constrained by the level of available UK resources. Having worked closely with FLTC for over three years, we are confident that we can seamlessly integrate their talented people into our business thus adding critical design capacity to support our future growth plans while adding additional expertise.
“We also believe that having a footprint in continental Europe, and specifically in the heart of the Czech Republic's automotive industry, will place us in an excellent position to further grow our Wipac brand. We are delighted to be strengthening our relationship with the FLTC team."