Investment boost for engineering company

Oct 16 2007 By Christopher Knox, The Journal

A SPECIALIST engineering business is set to double in size over the next four years after receiving a six-figure investment by a venture capital firm.

Newcastle-based Royston Power Generation is looking to double its turnover from £8m to £16m over the period, as well as significantly expanding its 80-strong workforce after receiving the cash injection from NEL Fund Managers in Gateshead.

Royston, set up in 1977, has already witnessed significant growth over the last four years, doubling its turnover from £4m to £8m and expanding staff numbers from 50 to 80.

The company installs, maintains and repairs diesel engines for a wide range of UK and international blue-chip clients in the defence sector.

Lawrence Brown, managing director of Royston Power Generation, said that it had been able to catch the eye of investors due to its impressive growth as well as its ongoing contracts with the Ministry of Defence.

He said: “We work with some extremely demanding clients in both the public and private sectors, and our past success has been based on providing them with the levels of service that exceed their requirements and enable them to carry on their operations with the minimum of disruption. These service levels come down to the quality of the people that deliver them, and we have invested in bringing in people with both the right skills and a clear understanding of what is required of them by our clients – these people make the difference that sets us apart and will continue to do so as we expand in the future.”

Mr Brown also said that, as well as looking at expanding beyond its two sites in Newcastle and Grantham in Lincolnshire, and extending its 20,000 sq ft factory space, the company was on the acquisition trail and was now big enough to begin buying other engineering firms in the North-East.

He said: “Our future growth is based around winning new clients and contracts, as well as retaining those that we already have, but if the right kind of acquisition opportunities come up, we will look seriously at them as well.”

Royston was able to draw on the advice of Newcastle-based solicitors Hay & Kilner during the investment process, while NEL was advised by the Newcastle office of Eversheds.

Duncan Lowery, capital fund manager at NEL, said: “Royston’s commercial experience, management expertise and sound plans for growth make them an excellent investment opportunity for us, and we are confident that the growth track record they have shown will be maintained in the coming years.”