THE proposed takeover of Aggreko, the listed Scottish temporary power company, brought lots of questions when it was announced on Friday morning, and it is likely to be some time before we get a clear sense of the answers.

To recap, the board of the Glasgow-based company has recommended that shareholders accept an offer from private equity players TDR Capital and I Squared Capital that values the business at £2.3 billion. It brought several weeks of speculation over its future to an end.

Analysts at brokers Panmure and Peel Hunt said the 880p per share deal tabled was a “good offer” for Aggreko, which has seen its share price endure years of decline since its £24-plus peak in 2012. However, as tends to be the case when major takeovers are in the offing, there will be no shortage of ramifications when the deal completes and Aggreko moves back into private ownership.

Perhaps the most immediate question will centre on Aggreko’s ongoing commitment to Scotland under new ownership, should the takeover deal secure the necessary regulatory approval (which is expected at some stage in the summer).

Aggreko, perhaps best known for providing power to events such as Glastonbury, the Solheim Cup and the Ryder Cup, has for many years been a provider of high-value jobs at its base in Dumbarton. It currently employs around 300 people at Lomondgate in the town, and had unveiled plans in January to invest £4.5 million to upgrade facilities at the site, underpinning its ambition to become net-zero in terms of carbon emissions by 2050.

Just as employees in Scotland may now be wondering what the future holds, the same is also likely to be true for the 6,000 or so other people Aggreko employs in nearly 80 countries elsewhere.

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While history shows the prospect of companies being taken over by private equity players can raise fears of cost cutting, the proposed new owners of Aggreko, TDR and I Squared Capital, have sought to provide some reassurances. Addressing the question of the future for the workforce, they state in the takeover document that they have “no intention of making any material changes to the conditions of employment or to the balance of skills and functions of the Aggreko Group’s employees or management”. They signalled that Aggreko will continue to be run as a standalone business, with its headquarters remaining in Glasgow.

The private equity groups did leave the door open to potential job cuts, which may arise from a planned six-month review of the management’s existing five-year plan after the deal goes through. Jobs may go as a consequence of Aggreko de-listing from the market.

However, they maintained that any headcount reduction following the review and the ending of Aggreko’s public company status is “not expected to be material in the context of the Aggreko Group’s global workforce and would at least partially be offset by new job opportunities created by the clean energy transition and Aggreko’s future business growth” .

Time is likely to be the ultimate arbiter on this, but the future of the Aggreko employees in Scotland is not the only question arising from the proposed deal.

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In the context of the Scottish economy, there is also the potential downside connected to the loss of another major listed business, and the likelihood that the key decision-making of the company will move outside of the country.

Aggreko now looks likely to join a long list of major Scottish companies which have lost their independence in recent decades, following in the footsteps of Stakis, General Accident, ScottishPower and Scottish & Newcastle. We have also seen the decision-making power at Royal Bank of Scotland, recently renamed NatWest Group, gradually shift south in the years since the financial crisis, while Bank of Scotland is now part of London-based Lloyds Banking Group.

While some may question the material significance of the move from public to private ownership, the loss of another, major listed company may be seen as a dent to the prestige of the Scottish business scene and its international reputation. This is significant as Scotland looks to rebuild its economy after Covid and attract the best talent to work here; it may also mean less work for professional and financial services firms north of the Border. The sense that the major decisions on the future direction and strategy of Aggreko will no longer be made in Scotland is only going to grow if the company is absorbed as just another in a long list of businesses that TDR and I Squared have stakes in.

UK-based TDR and I Squared, which operates in the UK and the US, have been keen to emphasise their wish to invest in Aggreko’s long-term future. But it would surely not be the biggest stretch of the imagination to envisage a day when the Scottish business is combined with one of the other companies the private equity companies are invested in.

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The TDR portfolio, for example, includes Modulaire, which rents out infrastructure such as storage units and air conditioning, while I Squared has an investment in Conrad, a modular power provider that supplies National Grid.

Both TDR and I Squared highlight in the takeover document their “proven track record and deep expertise in investing in power and energy transition infrastructure and equipment rental businesses”.

They add: “I Squared Capital and TDR Capital believe that Aggreko is a business that fits this investment focus well.”

One thing that does seem clear is that the bidders appear to have timed their move for Aggreko well.

From a high of more than £24 in 2012, the share price of Aggreko has dropped sharply in the last nine years as the company has navigated the collapse in crude oil prices from late 2014 and then, more recently, the impact of the coronavirus.

Shares were trading as low as £6 in the days before TDR and I Squared made their approach in early February.

Analysts at Panmure Gordon and Peel Hunt were enthusiastic about the deal. Panmure’s Robert Plant noted that Aggreko shares “underperformed” in recent years, and that private equity buyers may see the UK stock market as “cheap, especially post December’s Brexit deal”.

Mr Plant also underlined the fact that UK quoted companies such as Aggreko and G4S “could also be appealing to buyers as sterling has underperformed since the UK’s Brexit referendum” in 2016.

Meanwhile, highlighting his positive view of the deal for Aggreko, analyst Andrew Nussey at Peel Hunt said: “Despite some recent speculation we don’t foresee a competing or higher offer (TDR has a strong record in this sector).”

Of course, long-term shareholders in Aggreko may view things very differently, especially those who will have seen the value of their shares decline significantly over the last decade.