US investor takes majority stake in Irish engineering firm Leo Lynch

Irish engineering company Leo Lynch has received strategic investment from Cathexis Holdings, giving the US firm a majority stake.

However, Cathexis promised that Leo Lynch would remain an Irish company.

The value of the investment was not disclosed. However, Cathexis’s equity commitments range from $3 million for niche deals with high expected values, to more than $100 million for the purchase of established companies or financing infrastructure development. At the end of December last year, Leo Lynch had turnover of €44 million for the year.

The company, a specialist technical, mechanical and electrical engineering contractor, employs more than 200 people between its headquarters in Dublin and its sites in Kilkenny and Kildare. The company provides a range of services including design, project management and installation to a range of blue-chip clients in the pharmaceutical, biopharmaceutical, medical devices, semi-conductor and data centre industries.

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The deal must be approved by the Irish competition authorities.

Conor Lynch, principal at Leo Lynch, said the investment was "an excellent opportunity" for both the clients of and the employees of the company.

"Our clients will benefit from the potential addition of new services and the ability of the company to leverage the financial strength and strategic capabilities of an international investment house," he said. "The employees will benefit from Cathexis's commitment to scaling the Leo Lynch business and the opportunities this association will create for the business in Ireland and overseas. Most importantly, this deal will guarantee the continued success and growth of Leo Lynch into the future."

Texas-based Cathexis has highlighted Europe as an investment target, with Leo Lynch providing the company with the opportunity to enter a specialist sub-sector of the construction market in Ireland.

The combination of the two companies will allow it to tender for larger, more complex projects both domestically and internationally. Leo Lynch’s work is predominantly on the island of Ireland, although it has carried out some work overseas. Existing management of Leo Lynch have committed to stay with the business once the investment has been completed.

“Leo Lynch, as a leading mechanical and electrical engineering contractor, fits seamlessly with the tradition of Cathexis,” Cathexis Holdings said in a statement. “Via Cathexis, with its deep financial resources and experience of scaling companies, Leo Lynch can further expand the scope of its offering to its established blue-chip client base while providing these services across Europe through the Cathexis network. We always keep in mind that Leo Lynch is an Irish company and will remain an Irish company through which Cathexis will target future growth in Ireland.”