IF SUPERGLASS was a medical case, the prognosis for the Stirling-based company is, after protracted ill health, suddenly very good.

The insulation manufacturer was recently acquired by Russian roofing tycoon Sergey Kolesnikov for £8.7 million, with shareholders signalling their unanimous approval for the deal with his TechnoNICOL group this month.

The ownership paves the way for the formerly AIM-listed Superglass to bring new products to market and broaden its horizons in the export arena, while sharing its own expertise and intellectual property with its new parent company. It is also a major boost for the 150 staff employed at its manufacturing site and headquarters in Stirling.

But it wasn’t so long ago that Superglass was, in the words of chief executive Ken Munro, in “intensive care”.

Speaking in Glasgow this week, Mr Munro recalled how far the company fell in a troubling period from 2010 to 2015. He explained how a one-time City favourite saw its fortunes decline dramatically as schemes sponsored by the government to boost energy efficiency through home insulation began to unravel.

Superglass, which had been exposed heavily to that market, was forced to refinance three times as it dealt with the collapse of its core revenue stream.

“For five or six years, it was a fairly challenging backdrop with government subsidies declining or being withdrawn,” Mr Munro recalled this week.

“A business that had been floated for £120m in 2007, and was a bit of a darling of the City, within two years was beginning to experience some significant challenges, certainly by the time 2010 came around.

“Between 2010 and 2015 the business really went through several traumas.”

That the business was deemed an attractive buy for TechnoNICOL, which Mr Kolesnikov has built into Russia’s biggest construction materials manufacturer, is testament to the recovery overseen by Mr Munro and his team.

At the heart of that turnaround was a strategy which saw Superglass exit high volume activity and move into markets where it could command a greater premium for its output.

Mr Munro, who became managing director last February and replaced Alex McLeod as chief executive last June, said: “Certainly since I came in last summer we have really focused on price not volume. The whole focus for the business previously was to try and feed the 50-tonne beast at Stirling, and get the volume through the factory.

“That was almost becoming ‘at any price’, which was clearly having an impact on margin, hence three refinances and a period in intensive care.”

The strategy change has seen Superglass focus more on supplying “end users” such as housebuilders with a demand for more sophisticated products, including insulation with acoustic properties that command a higher price.

At the same time, efficiencies were driven forward at its manufacturing base, with the company closing down one of its two furnaces in a deliberate move to reduce capacity. Its two product lines are now driven by a single furnace.

That transition to higher margin activity was reflected in the company’s final trading update as a listed company. Reporting its half-year results at the end of April, Superglass declared that its recovery was “on track” as first-half losses narrowed to £1.8m from £3.1m the year before.

Further progress was made in the second half, noted Mr Munro, who revealed unaudited results show it has made a “swing in profitability of in excess of £3m” in the last year.

Against that background, Mr Munro had not been actively seeking a buyer for the business.

The initial talks between Superglass and Mr Kolesnikov, which followed an approach early this year, focused on exploring a commercial partnership. But, with a day of talks commencing, Mr Kolesnikov had come to the table with an offer to buy.

Mr Munro said he knew instinctively that becoming part of the TechnoNICOL group would offer Superglass a massive opportunity to expand.

TechnoNICOL has 40 manufacturing sites in six countries – Russia, Ukraine, Lithuania, Belarus, Italy and the Czech Republic – and exports to 79 countries. It already generates millions of pounds of revenue in the UK from the sale of building materials via a distribution hub in the south of England.

“For me it was the fact we could really turbo-charge the strategy with the cash resource, the products and the reach of TechnoNICOL,” said Mr Munro, who will continue to lead Superglass in the UK.

That view was shared by majority shareholder Peter Gyllenhammar and indeed investors across the board, who accepted an offer valuing the firm at a 114 per cent premium on the share price.

Asked whether staff in Stirling had any concerns about the move into foreign ownership, Mr Munro said: “I think that evaporated pretty quickly as they understood the scale of the organisation. What you have to remember is the trauma we had been through for the last six or seven years.

“It wasn’t a hard sell for 150 people who three years ago couldn’t have dreamt of this level of transformation in the business.”

Curriculum vitae

KEN Munro is a graduate of Heriot-Watt University and started his career at NCR in Dundee, rising to become VP of engineering and VP of global marketing in a 16-year spell.

He was managing director of Fife-based Havelock Europa’s education division before joining Superglass as strategic development and sales director in 2014. He became chief executive in January 2015.

Mr Munro is married with four children.