UK-based engineering firm Ricardo has agreed to acquire LR Rail from Lloyd’s Register Group, in a £42.5m deal.
As part of this development, the acquired business will combine with Ricardo’s existing rail industry expertise to launch Ricardo Rail.
Ricardo CEO Dave Shemmans said: "LR Rail has an impressive market reputation and a very similar culture of quality and excellence in engineering to that of Ricardo, and will be an exceptionally good fit with Ricardo in terms of culture, geography, product offering and business model."
LR Rail offers services, including rolling stock design, signalling and train control, intelligent rail systems, operational efficiency improvement, training and independent assurance services.
The company employs a staff of 440 rail engineers and specialists and recorded on a standalone basis revenues of £48.1m in 2014.
Ricardo said the new company will be positioned to exploit the expanded global footprint of the combined business.
Meanwhile, Lloyds Bank Commercial Banking has delivered a £40m funding package to support Ricardo’s acquisition of LR Rail.
The bank has increased its revolving credit facility with Ricardo from £20m to £40m and it will help the UK firm to meet the upfront cost of the acquisition, while retaining the capital to cover the future operating costs.
Image: The new acquisition will see the launch of Ricardo Rail to combine LR Rail with existing Ricardo rail industry expertise. Photo: courtesy of Ricardo.