Advent launches break-up of UK aerospace jewel Ultra Electronics
Private equity group Advent International has fired the starting gun on its break-up of cutting-edge British aerospace group Ultra Electronics.
The US group has sold Ultra’s pioneering forensics division to a Texas-based group called Leads Online.
Advent swooped on Ultra, which was a FTSE 250 index member, in a £2.6 billion deal in June 2021.
But the takeover went through only last year following an in-depth investigation that scrutinised how the sale to a US firm would affect the UK’s national security.
Ultra was regarded as a strategically important company because its work includes making sonobuoys for hunting enemy submarines and technology used in F-35 fighter jets.
Flight risk: Ultra’s work includes making sonobuoys for hunting enemy submarines and technology used in F-35 fighter jets (pictured)
Advent had already come under fire for the rapid break-up of another British defence company, Cobham, which it pounced on in 2019 for £4 billion.
Ultra’s ballistic forensics business had previously been earmarked for sale by Advent as it was not regarded as a core part of the company.
Its world-class technology is used by police forces and crime agencies in 80 countries to solve gun-related crime by analysing bullets in detail and putting the information in databases. This enables users to connect ‘cold cases’ and link crimes that have been committed with the same gun. Leads Online, which provides data and intelligence tools to law enforcement agencies, did not say how much it paid for the forensics division.
The sale will fuel fears that Advent could further break up the company.
Despite pledging to be a ‘long-term investor’, Advent carved up Cobham, which pioneered air-to-air refuelling technology, within 18 months of acquiring it.
This is a typical business model for private equity firms, which was why many defence experts and MPs criticised the sale.
Lord West of Spithead, the former First Sea Lord, previously said Ultra’s sale to Advent could leave Britain at the mercy of Russia and China’s navies as submarine warfare is set to become the next ‘major theatre of war’.
Ultra traces its history to 1920, when it started as a small electronics factory in West London.
