Highlighting technologies promising future growth, Northamptonshire based Cosworth, an unusual mix of manufacturer, technical consultant and research business, is promoting itself in order to find a new owner.
Cosworth was set up in 1958 by Mike Costin and Keith Duckworth, two UK engineers, and is best known for designing a series of high-performance engines for Formula One racing. Estimates as to how much Cosworth might be worth vary from £50m to £150m. UBS has been hired by Cosworth to evaluate potential buyers. Cosworth hopes to finalise the sale by May next year.
Examples of the work underway highlighted were a set of engines under development in a partnership with an unnamed European car company. According to Chief Executive Tim Routsis, the products offer a similar level of performance as a Formula One engine but at a potential cost of as little as £3,000 each, compared with £250,000 for the racing car equivalent.
Developing new type of communications system to allow continual interaction via the social media sites
Another new product that Mr Routsis says Cosworth is working on is a new type of communications system that could be fitted to cars to allow continual interaction via the internet with social media such as Facebook and Twitter.
Mr Routsis refuses to provide more details of what is special about the product beyond saying it is different to anything available in the vehicle industry. “We are working on this with a US carmaker and will soon be in a position to make about 100 of these products a day for our customer,” Mr Routsis says.
Most profits not directly racing related
Last year Cosworth had sales of £54.7m, with pre-tax profits of £5.2m. Of the 2011 revenues, about 10% came from engines and related products for racing cars, with the rest derived from other industries such as defence, aerospace and mainstream automotive. Businesses that could consider the idea of buying the company include Ricardo, a rival UK consultancy and engineering group; Tata, a large Indian industrial business keen to expand in Europe; and Magna Steyr, an Austrian engineering specialist - that recently lost out on a contract to assemble Nissan's Infimniti premium vehicle.
Cosworth has 300 employees – 90 per cent of them based in the UK most of whom operate from the company’s Northampton headquarters. Almost a third of the employees are technical specialists with expertise from metals fabrication to high-speed data transmission.