There was acquisition of all the shares of Rail Electrification Limited by the Engineering service group Renew. With a deal worth £5.3m (approximately), the transaction of shares has been made through Renew’s subsidiary QTS Group.
This expansion will improve Renew’s rail electrification capabilities as moves accelerate towards delivery of a carbon-neutral rail network. REL adds overhead line electrification to QTS’s services, which already includes vegetation management, drainage, and civil engineering.
This move will allow REL to operate as a wholly owned subsidiary of QTS, which joined Renew in 2018. The current REL team, including Mark Potts, Scott Kernachan, and Kenny Barr, (management trio) will join QTS at its Scottish HQ in Drumclog, South Lanarkshire.
There were initial settlements in payments for the acquisition, with £3m in cash. The further deferred cash payments are up to £2.3m payable between the current date and September 2024, conditional upon the achievement of certain targets.
The purchase has been funded from Renew’s existing cash resources. Renew said that the acquisition brings highly complementary capabilities to its existing rail business. This will enable the group to capitalise on the planned investment by Network Rail in rail electrification.
Besides, Scotland-based REL provides services and a road-rail plant associated with the installation and commissioning of overhead line electrification (OLE). This was for both light and heavy rail infrastructure across the UK.
It is estimated that there will be about 15,000 single-track-kilometres of new electrification carried out across Network Rail-controlled infrastructure. This will be a part of the UK government’s commitment for a carbon neutral rail network by 2040 for England and Wales.