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Smiths Group, the industrial engineering group, is on Monday expected to announce it has bought a US technology company for $185m, its biggest purchase since Philip Bowman took over as chief executive in 2007.

Separately, the company has also sold its old Finchley Road headquarters in north London for just under £11m ($16.4m) – put up for sale by Mr Bowman as part of a restructuring at the group after he joined.

Smiths will fund the all-cash purchase of Interconnect Devices Inc (IDI), a Kansas City-based manufacturer of probe technology for use in semi-conductor testing, from internal resources. IDI designs and produces connectors for semi-conductor and circuit-board testing for military, medical and homeland security markets. Half of its employees are based in China, with a specialist engineering centre in Arizona.

The bolt-on acquisition, still subject to regulatory approval in the US, will become part of Smiths’ Interconnect business which makes electronic and radio frequency components.

Mr Bowman has in the past made clear that despite the tough trading environment the group faces he wants to expand its reach geographically in countries like China, as well as in complimentary technologies.

The news comes ahead of Smiths interim results on Wednesday. The company has been hit by difficult trading conditions over the past year. In September it reported underlying profits had fallen sharply in the year to July although it cheered investors with higher-than-forecast cost savings and strong cash generation. Mr Bowman is expected to reiterate his focus on improving margins at the results.

Analysts at housebroker Cazenove are forecasting group sales for the first half of £1.29bn, up from £1.28bn in the same period last year. Earnings before interest, tax and amortisation are forecat at £198.1m, up from £185.1m the year before.

Shares in the company, which have risen by 43 per cent over last year, closed at £11 on Friday, valuing its equity at £4.29bn.

Copyright The Financial Times Limited 2017. All rights reserved.
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