6 March 2020, Burton upon Trent, UK – Doncasters Group today announced the completion of its financial restructuring, as well as the appointment of a new Chief Executive Officer, Non-Executive Chairman and a Non-Executive Director.
The financial restructuring which has removed c.£900m of debt from the Operating Group’s balance sheet and improved liquidity to support the next phase of its strategy was completed with the support of Doncasters’ first and second lien lenders, who saw the inherent strengths of the business and voted unanimously to support the restructuring in return for ownership of the Operating Group.
On 1 March 2019, Jas Sahota, formerly a senior restructuring partner at Deloitte LLP, was appointed as Executive Chairman and Chief Executive Officer of Doncasters Group. Over the past 12 months, the 240-year-old business has embarked on a three-part programme: the divestiture of eight non-core facilities; business model simplification around its high value superalloys and investment casting manufacturing activities; and the financial restructuring.
With his primary objectives successfully completed Jas Sahota will step down with immediate effect, announcing as his successors Mike Quinn as Chief Executive Officer and Dirkson Charles as Non-Executive Chairman. In addition, Nick Sanders will be appointed as independent non-executive director. Chief Restructuring Officer Michael Thomas will also step down from his interim Board role now that the financial restructuring has been successfully completed.
Jas Sahota commented: “The Doncasters’ Board and senior leadership team, supported by our colleagues across the Group, have over the past 12 months successfully implemented the first stage of a multifaceted strategy and I would like to thank them for their dedication and achievements. Mike Quinn’s and Dirkson Charles’s appointments will provide invaluable deep industry and operational expertise for the implementation of the next phase of Doncasters’ strategy and operational excellence programme in its chosen core markets. The Group is well positioned to deliver the next phase of its strategy against a backdrop of financial strength and streamlined business model and, importantly, with the continued support of the Group’s lenders, who now also become the new shareholders.”
Mike Quinn stated: “It is a privilege for me to have the opportunity to lead an organisation with the capability and history of the Doncasters group. My initial priority is to share the news with our customers that we are here to stay for the long haul and have the backing of our shareholders to invest in the businesses. Couple this with the skills and dedication of the workforce and I believe this will provide a compelling proposition for our customers as we endeavour to grow our aerospace and IGT businesses. Internally, our focus will be on operational excellence to provide our customers with a strong strategic partnership and high-quality products when they need them.”
Mike Quinn most recently served as the CEO of Ervia, the parent company of Gas Network Ireland, Irish Water and Aurora Telecom. From 2005 to 2014, Mike worked at Precision Castparts Corporation as the Group Vice President with the responsibility for five operating businesses across 10 locations.
Dirkson Charles commented: “I am excited to lead the Board of Directors of Doncasters as we move forward with support from our shareholders, the talent and experience of our over 2,200 employees and a clean sheet of paper that will allow us to position Doncasters for success in the future. Over the course of the next 60 days we will put in place a Board to supplement the management Team lead by Mike Quinn. The first of such appointments is Nick Sanders and who brings a wealth of experience in managing businesses through a transition to success.”
Dirkson is the founder and CEO of Loar Group, Inc, a leading designer and supplier of aerospace and defence products, with a mission to acquire companies in the aerospace and defence industries with niche, proprietary and/or leading product offerings within their markets. Previously, Dirkson served as the CFO and Executive Vice President for McKechnie Aerospace between 2007 and 2010.
Nick Sanders most recently served as the Chairman of Gardner Aerospace between 2010 and 2019, Gardner Aerospace is an international manufacturer of aerospace finished components. Previously Nick held various roles in the aerospace industry, including the CEO of CompAir Inc from 2002 to 2009, as well as the Operational Director at TRW Lucas Aerospace between 1992 and 2001. Nick started his career at the aerospace division of Rolls-Royce.
Editors Notes / Additional Information
Details of the Scheme of Arrangement:
- The transfer of ownership of the operating group to a new lender-owned holding company;
- The reinstatement of 50% of the first lien debt in the operating group, with the other 50% exchanged into Holdco PIK debt and equity;
- The conversion of 20% of the second lien debt into Holdco PIK debt and equity, with the remaining 80% released;
- The injection of a £70m Working Capital Facility to provide ongoing liquidity for the operating group;
- The Loan Notes held variously by affiliates of Dubai International Capital and former management of Doncasters no longer benefit from any claims against entities which hold an interest in the business operations of the Group;
- Post the financial restructuring the operating group has approximately £240m of net debt and has removed approximately £900m of liabilities from its balance sheet.
The restructuring process has also involved the streamlining of Doncasters’ operational presence, through the phased divestment of non-core operations. The newly restructured Doncasters will now have a global a footprint with a firm focus on precision castings and superalloys.
Disposals over the last 12 months include:
- US Fabrications facilities (IET and MECO) – Jan 2019
- Belgian Titanium Specialist SETTAS – Sept 2019
- UK Fabrications facilities (Bramah and Shrewsbury) – Nov 2019
- UK Forgings facilities (Blaenavon and Doncasters Precision Forgings) – Nov 2019
- UK Centrifugal Castings facilities (Firth Vickers Centrispinning in Sheffield and Paralloy in Billingham) – Dec 2019
The Doncasters Group is a leading international manufacturer of high-precision alloy components which are designed to operate in the most demanding of conditions.
With 240 years of experience, this agile group is constantly developing its expertise to best serve OEMs in the aerospace, industrial gas turbine and specialist automotive markets from its 12 manufacturing facilities located in four countries worldwide.
Core areas of expertise include new product development, precision casting, superalloy production and the supply and manufacture of automotive stud welding equipment.