Perth-based Kilmac Group is targeting sales of £5 million from biomass-related work after snapping up a fledgling local energy services firm.
The company – which is primarily known for its construction and civil engineering work but which also has interests in the onshore wind and hydro power – confirmed it had added Angus-based Eco Biomass to its existing renewables portfolio.
The firm was set up by entrepreneur George Penman three years ago after he identified a niche in the provision of biomass solutions for domestic, commercial and industrial premises.
Under the terms of the deal – which has been completed for an undisclosed sum – all seven Eco Biomass employees have transferred to the Kilmac Group and Mr Penman has been appointed as Technical Director of the newly formed subsidiary, Kilmac Renewables.
“When we first considered setting up our subsidiary, Kilmac Energy, we considered all forms of renewables including hydro, wind and biomass,” Kilmac Group co-founder and director Richard Kilcullen said.
“Eventually we settled on developing onshore wind and then added hydro. The Scottish Government’s ambitious targets to see all Scotland’s energy needs met by the different types of renewables made this a very exciting sector to invest in.
“We’ve had experience of being involved in biomass projects previously, but on the civil engineering side, adding the plant room and other construction works.
“Through that experience we were aware of George and his firm, Eco Biomass. His business has grown rapidly but it was clear that he needed to improve his management structure and get more financial muscle behind him.
“Discussions were held and eventually we agreed the best way forward was for Kilmac Group to absorb Eco Biomass and it’s employees and create a new subsidiary, Kilmac Renewables.
“I’m delighted we’ve added George and his team to our company.
“I’m confident that with the orders Eco Biomass has in the pipeline, and the growing interest in biomass as a heat and energy source, that we can triple the workforce and take turnover to around £5 million within the next two years.”
Mr Penman said more people were turning to biomass as an alternate source of heat and energy as electricity and gas prices continued to rise.
“I’m very pleased to have joined forces with the Kilmac Group,” he said.
“I’ve known the directors, Athole McDonald and Richard Kilcullen, for a number of years and believe this is the ideal way for me to see the many opportunities in biomass investment being fulfilled.”
The new tie-up was praised by Perthshire North MSP and Finance Secretary John Swinney.
He said: “This is an excellent acquisition by Kilmac Group of Eco Biomass, a thriving home grown business which will add a great deal of breadth to Kilmac Renewables’ capabilities.
“I look forward to the continued commercial success of this dynamic Perthshire business and the benefits this will have for both the local and wider Scottish economies.”