Spirax Sarco Engineering, the UK-based group focused on systems for the use and control of steam and industrial fluids, is boosting its activities in the biopharmaceuticals sector through the acquisition of Denmark's Flexicon A/S for DKK 141m (€18.9m).
The acquisition is being made through the Spirax Sarco subsidiary Watson-Marlow Bredel (WMB), a world leader in peristaltic pumps sold to industries ranging from pharmaceuticals and biotechnology to ceramics, food processing, print and packaging, and waste disposal.
Flexicon, which markets peristaltic aseptic filling systems to the biopharmaceutical industry worldwide, has a product portfolio that complements the existing WMB range of peristaltic pumps for dispensing applications and strengthen the latter's presence in the biotechnology and pharmaceutical sectors, Spirax Sarco said.
According to the UK group's finance director David Meredith, both Flexicon and WMB "will benefit from the combined increased sales into these growing industries".
The purchase price excludes any cash or debt balances and the acquisition, which includes full ownership of Flexicon's US distribution company, Flexicon America, will be financed out of the UK group's existing cash resources.
Spirax Sarco is paying DKK141 million for the entire issued share capital of Flexicon, with DKK113 million due on completion (expected by the end of February) and the balance payable in three equal instalments over the next three years. Flexicon reported turnover of DKK65 million for the year ended 30 June 2007.
The acquisition is expected to deliver a small benefit to Spirax Sarco's earnings per share from 2008, once interest funding costs have been deducted.
The rationale behind peristaltic pumps is that conventional pump types are ill suited to industries handling corrosive or toxic media with high specific gravities. Exposure to these liquids results in clogged valves, perished diaphragms and corroded rotors, WMB says.
By contrast, peristaltic pumps have no valves, seals or glands that can leak, clog and need to be replaced. The key, WMB explains, is that the pumped fluid does not come into contact with the pump itself, only with the tube or flexible hose carrying the fluid. This also eliminates the risk of the pump contaminating the fluid, or vice versa.
Peristaltic or hose pumps operate on the 'positive displacement' principle of the human digestive system. Rollers within the pump housing compress the hose against a semi-circular track and the pressure point moves along the hose, pushing the contents in front of it while the hose behind the pressure point resumes its shape, sucking in more fluid.
WMD offers a range of peristaltic pumps for the pharmaceutical and biotechnology industries, handling fluid volumes from microlitres per second to 80,000 litres per hour.
"Pharmaceutical and biotechnology processes demand sterility and a high degree of precision to ensure the integrity and quality of the end product," the company notes. "As as a consequence, fluid isolation and precise metering are essential requirements from a pump." According to WMD, its pumps can deliver accuracies of up to +/-0.5 per cent.
Flexicon's business also operates on the "peristaltic principle". Among the benefits of peristaltic filling systems, the Danish company cites very short changeover times, high precision (0.5 per cent on a 1 ml filling), less cleaning validation, no product contamination, easy adjustment and calibration, and gentle handling of liquids containing living cells.
The company's target market is small to medium-sized batch productions requiring flexibility, high precision and efficiency. Flexicon's product portfolio ranges from stand-alone units for hand filling, through semi-automatic systems, to fully automatic filling, stoppering and capping machines. The fully automatic systems are customised to fit any container, be it a glass vial, plastic bottle, test tube or non self-standing micro tube.
Spirax Sarco could not supply any breakdown of sales by industry, either before or after the Flexcon acquisition, but Meredith said peristaltic pumps "lend themselves very well to the clean requirements of the pharmaceutical and biotechnology industries, and it is therefore an important market for WMB".