CG Power Systems Ireland – new owners announced
MML Growth Partners announced that their bid to acquire CG Power Systems Ireland Limited (CG Ireland) had been accepted by the Belgium liquidators.
Image for illustration purposes
Ireland, Cavan: MML Growth Partners, a growth fund supported by the Irish Strategic Investment Fund, announced that their bid to acquire CG Power Systems Ireland (CG Ireland) had been accepted by the Belgium liquidators.
This follows on the liquidation of CG Power Systems in Belgium in February of this year. CG Power Systems Ireland had been a subsidiary company of Belgium based CG Power Systems BV.
CG Ireland had been manufacturing transformers in Cavan since 1977 and previously formed part of Pauwels transformers. The Indian and Mumbai based multinational Crompton Greaves acquired the Irish factory in 2005 when it bought Pauwels.
MML will be the majority shareholder, alongside the current management team. MML capital comes from a number of partners including the Ireland Strategic Investment Fund, an Irish Government development fund, AIB Bank, and international investors like New York Life, the American life insurance business. The Irish MML Fund is dedicated to the development of small and medium sized business enterprises in Ireland.
The management teamnremains and will continue to report to Ms. Stephanie Leonard the current CEO. Ms. Leonard succeeded James McMahon as Irish CEO. McMahon had previously been responsible for the CG EMEA distribution transformer portfolio 2016-2017 and then retired in 2019 from the Cavan plant. The deal is subject to approval from the Irish Competition and Consumer Protection Commission.
The Irish plant remained operational during the Belgian liquidation process. Whilst the plant had been incurring losses in recent times, it returned to profitability following a restructure in July 2018, removal of loss making contracts and the sourcing of Invoice Discounting facilities locally. A decision by K. N. Neelkant, the Indian based CEO of CG Power Group in 2018 to separate out the business and sales teams at that time also served the Irish company well. Neelkant resigned from the CG Board in October 2019 following allegations of fraud at CG. The Irish factory subsequently returned to profitability and it achieved revenues of around $80 M (€70 M) in the 2019/20 financial year.
The Irish factory is expected to be re-banded and continue to service its broad international customer base with its best in class product portfolio from its Cavan facility.
Author Chris Gerber
*The opinions expressed in this article are those of the author and they do not necessarily reflect the opinions or views of the Transformers Magazine and Merit Media Int.