Rosebank Industries, the London-listed vehicle launched by Melrose founders Simon Peckham and Christopher Miller, will raise £1.14bn to acquire Electrical Components International (ECI) from Cerberus Capital Management in a deal valued at under $1.9bn.

The transaction will be financed through a mix of debt and a fully underwritten institutional capital raise priced at £3 per share. The shareholder vote is set for 1 July.

Backed by investors including BlackRock, Norges, and GIC, Rosebank follows the same industrial turnaround playbook that defined Melrose’s success. Peckham, now CEO of Rosebank, said the deal marks the “first step on the journey” and added, “We are very confident that we can help ECI to fully realise its potential for the benefit of its employees, customers and our shareholders.”

ECI, which reported $1.3bn in revenue last year, manufactures wire harnesses and control systems for large industrial clients. Rosebank aims to double shareholders’ investment over a three-to-five-year period by improving ECI’s adjusted operating margin from 13% to over 18%, and its earnings margin to above 20%. The company also plans to continue ECI’s strategy of acquiring smaller, high-margin businesses using internal cash flows.

The deal follows Rosebank’s re-engagement with Cerberus, after initial talks were flagged in February. It reflects a renewed push by the former Melrose executives to replicate their past success, including the controversial £8bn takeover of GKN in 2018.

Source: Financial Times

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