Professor Wrixon, who earns €180,736 a year as president of UCC, founded Farran Technology in 1977 to supplement his UCC lecturer’s salary. UCC colleagues Dr Sverre Lidholm and Nualight director Liam Kelly who hold a 30% share in the company will receive €3.6m each as a result of the deal.
Cork-based venture capital company Bank of Ireland Kernel Partners Private Equity, which took a 19% stake for €800,000 in Farran Technology in March of 2003, is also a major winner.
It was Kernel’s first major investment and they were the first company to back Farran. Another venture capital company Delta Partners also took a 19% stake at the same time as Kernel and both will receive €4.56m as a result of the sale of the company.
Loss-making Farran, which is developing cutting edge electromagnetic radiation technology for the detection of hidden weapons and explosives, is expected to increase its 30-strong workforce at Ballincollig, Co Cork when Smiths complete the takeover. Professor Wrixon, who is facing opposition to a proposal to allow him remain in his post past the normal retirement age of 65, is abroad and was unavailable for comment last night.
Farran managing director Tony McEnroe and the 30 members of staff at the Ballincollig-based company also have shares in the company and will benefit directly from the cash sale. Current management and key personnel will remain with the company as part of the buy-out arrangement.
Farran Technology has been purchased by the Smiths Group, where former NATO general secretary George Robertson is on the board of directors.
Farran will be run by Smiths Detection which received up to €36m in contracts in 2003/2004 from the Britain’s Ministry of Defence.
Smiths, will pay an initial €19 million in cash plus a deferred performance-related payment up to a maximum of €5 million. The takeover of Farran Technology by the Smiths Group, with annual sales of €3.871 billion, copper fastens the future of the company which started life as a UCC campus company.
Smiths who made pre-tax profits of €505 million in 2004 believe the acquisition strengthens the company by expanding the range of technologies offered by its rapidly growing detection division.
Farran is one of very few companies outside the USA with high frequency design capabilities in this field.
Smiths Detection plans to expand Farran’s research and development activity to support the continued growth of its microwave sub-systems operations.