Endless-backed SME fund Enact acquires Stirling Dynamics

Enact has taken a majority stake in advanced engineering design firm Stirling Dynamics.

The dedicated small and medium-sized enterprise (SME) Enterprise Investment Scheme (EIS) fund is part of Leeds-based private equity house Endless.

Stirling Dynamics was founded in Bristol in 1987 and has grown to deliver services to the aerospace, marine and energy sectors.

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The business, which employs 102 people, focuses on active control technologies, control theory and aerospace engineering, including aerodynamics, stability and flight dynamics.

Enact said it has “ambitious plans” for the business and aims to invest significantly in the development of existing products, diversifying its range and expansion of its consultancy services.

Investment director Chris Cormack said: “Stirling Dynamics has an excellent reputation and track record, backed by 25 years of accumulated experience, IP and know-how in the advanced engineering sector.

“Our investment not only puts in place a succession planning strategy for the business going forward, but also provides scalability of supply to the existing product range, particularly around military training simulations for the F-35 jet fighter programme. With this and other blue chip client partnerships in global markets including Europe, the USA and Asia, Stirling Dynamics is in a strong position to grow and build on its success to date.”

Mr Cormack has joined the company’s board and will support the management team, led by managing director Stephen Judd. Robert Stirling, founder of Stirling Dynamics, will remain with the company as its president.

Mr Judd added: “Enact was carefully selected by the existing management team as the investment partner of choice, to take Stirling Dynamics to the next stage of its development. Facilitating our plans for growth through investment capital and management support, Enact will provide the tools necessary to achieve our aspirations whilst valuing the key attributes that are the essence of the company.”

Stirling Dynamics is Enact’s second investment since the launch of the £7.5m fund earlier this year, having struck a deal with West Cornwall Pasty Company in April.

Interest in the fund “remains high”, Mr Cormack said. He added: “We are in advanced discussions with a number of other businesses and are hopeful of announcing further transactions shortly.”

The fund provides equity investments of between £250,000 and £2m to companies in the small and medium-sized business market. Its strategy is to invest in businesses that have a robust business model, but are facing cash flow constraints, strategic or operational issues.

Enact’s parent company Endless specialises in turnarounds, with a portfolio of companies with turnover in excess of £2.0bn and around 12,000 employees.

In September, it announced plans for a new fund that would target investors from the Far East for the first it. It is understood to be aiming to raise £400m, double its last fundraising round.