SHANNON Development has taken a 25 per cent stake in the Listowel based company Stelrad Components as part of a management buy out (MBO) at the engineering company.

Stelrad, which makes connections for domestic and industrial radiators, was bought by its management and a number of other outside investors from the publicly quoted British group Caradon.

Caradon had wanted to close the Listowel operation and transfer the business to Britain, but changed its mind after an approach from the local management backed, in part, by Shannon, Development funds.

Neither Shannon Development nor Stelrad would disclose the value of the MBO. However, it is thought to be about £1.4 million. ,Stelrad, which employs 55 people, will now trade as Radlink.

The company had a turnover of £4.5 million last year and expects to grow its business in the medium term. Most of Radlink's production is exported, and about half of its business is supplying its former parent Caradon.

The investment in Radlink is Shannon Development's third MBO participation, and the semi State said it hopes to make further investments of this type in the future.

Shannon Development will retain its shareholding for up to 7 years but expects to sell its 25 per cent stake in Radlink after about 5 years.