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Aggreko latest British firm to be targeted by private equity

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Generator firm Aggreko becomes latest British firm to be targeted by private equity

Aggreko has become the latest British firm to be targeted by private equity.

The generator firm has received a £2.25billion approach from London-based TDR Capital and Miami business I Squared Capital.

If the deal goes through, it would be the latest in a string of listed UK companies to be taken over by private equity firms in recent months as valuations have fluctuated amid volatile markets. 

Aggreko, which has been listed in London since 1997, has contracts to supply power equipment for the Tokyo Olympic and Paralympic Games. It values the Olympics contract at £229m. 

The company has performed solidly through the pandemic and donated thousands of generators to Covid-19 testing sites across the UK since the pandemic broke out. Chaired by Ken Hanna, a City veteran, the company recently upgraded its full-year profit forecast, saying activity levels had recovered more strongly than anticipated. 

Aggreko said TDR and I Squared had made a series of proposals in the past and it was now in talks with them over a possible cash offer of 880p per share. TDR is well known to British investors. Based in plush offices in Marylebone, central London, the company recently teamed up with the Issa brothers to buy Asda for £6.8billion. The company has also invested previously in food chains such as Pizza Express. 

Aggreko was set up in the Netherlands in 1962 but moved to Glasgow in 1973 and has been there ever since. 

The City has been buzzing with private equity activity this year. Last week pub group Marston’s rejected an approach from Platinum Equity. Two weeks ago AA ended its disastrous run on the stock market after investors gave the green light for a £218m takeover offer from Towerbrook Capital and Warburg Pincus. 

The firm, which was founded in 1905 as the Automobile Association, has 3,000 patrol vehicles and provides roadside assistance to 12m members.

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