British buy-out boosts DavyMarkham
Sheffield heavy engineering specialists DavyMarkham can trace its roots in the industrial heartland of the city as far back as 1830.
The company has a long and proud history of design, manufacture, fabrication and machining of heavy and complex engineering components and assemblies.
From its 175,000 sq ft manufacturing facility on the Davy Industrial Estate, where it has been based for almost 200 years, the company works on hundreds of projects every year for clients from across the globe.
From its humble beginnings of two brothers working together in 1830 to two thousand skilled workers at its peak, DavyMarkham Ltd has been synonymous with the steel industry since its first steam train left Sheffield in 1840.
However, throughout those 200 years, the company which has worked on projects such as the Channel Tunnel, Gateshead Millenium Bridge and Wembley Stadium, has encountered some pretty turbulent times.
After going through a series of mergers, the company fell into the hands of private equity firm Endless in 2007 before being sold to Indian conglomerate IVRCL in 2010. Under IVRCL’s tenure however, the company saw orders decline.
IVRCL continued to run DavyMarkham for a further four years until it was acquired and brought back into British hands by Hughes Armstrong back in 2014.
Now, after a period of foreign ownership and declining orders, it is strengthening its work in traditional engineering sectors while increasingly securing contracts in the nuclear and defence industries.
Chief executive Bill Clark told BQ: “Hughes Armstrong are hands on investors who concentrate primarily on turning around under-performing engineering and manufacturing companies in the UK. Over recent years, DavyMarkham struggled to develop and implement a coherent strategy and Hughes Armstrong have provided the support and guidance needed to address this challenge.”
Clark, who was a director at Tata Steel at the time, helped lead Hughes Armstrong’s takeover of DavyMarkham back in 2014 and was in turn appointed to lead the company when the takeover was given the green light.
So, why the decision to jump ship from a major company like Tata into a recovery job at DavyMarkham? Bill explains: “Over recent years, Tata Steel has constantly undertaken a review of its strategy for the UK.
“Whilst at Tata, I was leading engineering and manufacturing in the rail, energy from waste and the nuclear and defence sectors and Tata's strategy in the UK in these areas was unclear.
“I decided DavyMarkham needed help in confronting the challenges in re-positioning the business and I was keen to lend a hand.
“Hughes Armstrong were passionate about the opportunity in the areas in which I have strong expertise and this attracted me to the challenge of revitalising and rejuvenating DavyMarkham.”
The decision proved a shrewd one and three years on, DavyMarkham has returned to growth and is starting to see its order book fill up.
In fact, just last month, DavyMarkham secured a lucrative export deal to supply mine hoists for an operation to extract nickel ore mine in Canada.
The deal will see its engineers design and manufacture the equipment at the firm’s headquarters in Prince of Wales Road, Darnall, Sheffield, before being installed by its site engineers and technicians at the Copper Cliff Mine in Ontario in the second quarter of 2018.
The contract consolidates its relationship with global mining company Vale, one of the leading producers of nickel. It is part of the first phase of a major project over four years to reactivate and expand the mine under the town of Copper Cliff.
Work covers the south shaft, hoists and headframe and also involves underground development to access new mining fronts approximately 5,200 feet below the surface.
DavyMarkham is the world's largest vertically integrated mine hoist supplier and has supplied mine hoists and installation support for Vale on previous projects.
Clark added: “The importance of manufacturing in the UK, and particularly in Sheffield, is bolstered by DavyMarkham’s ability to provide mine hoist solutions that meet the needs of customers such as Vale.
“We are pleased to have been awarded this contract and this reinforces the need for DavyMarkham to continue the development of our technology to ensure that we meet the future demands of customers.
“Commitment to research and development and understanding our customer needs ensures that we will be here supporting mining companies like Vale well into the future as they continue to sustain and expand their operations.”
The company also announced this month that it had secured a £20m contract with Magnox Ltd to help with the safe decommissioning of nuclear facilities in the UK, adding to its growing international reputation for heavy and complex engineering, notably in the mine hoist, tunnel boring, hydro, steel and bridge building sectors.
And this recent success has been bolstered not only by the new strategy implemented by the company’s new owners but also Britain’s decision to leave the European Union, which Clark believes has proven to be a real boon for the company.
He said: “The change in currency has made us more competitive in the international market and this has been demonstrated through the recent award of a multi-million-pound engineering and manufacturing contract for mine hoists in Canada.
“Competition is typically the US, Canada and mainland Europe and improved competitiveness is leading to increased confidence in the medium-term post Brexit. We will continue to seek projects around the world and compete with our fellow Europeans.”
So, what’s next for DavyMarkham? Clark concludes: “There are a number of major infrastructure projects on the horizon, including HS2, Swansea Bay Tidal Lagoons and flood protection schemes such as Boston Barrier. Improved concentration on these markets through the recruitment of seasoned professionals and is key to our expansion.
“In addition, we will continue to increase the employment and training of apprentices and by September of next year we anticipate having approximately 20 apprentices in varying stages of development.
“The company has grown by about 10% since the start of 2017 and this is largely attributable to the success in securing contracts in the nuclear and defence and infrastructure markets. We’re also anticipating further growth over the next 12 months of at least 10%.”
Published: 28 June 2017