ECI, a UK mid-market buyout firm, has agreed to sell Racal Acoustics to Esterline Technologies for GDP115m.

Completion of the transaction is contingent only on German regulatory approval and is expected to take place in January.

Based in Harrow, Racal Acoustics is a provider of specialist hearing protection and communications products for military and avionics applications.

Its headsets are used by 120 branches of the military in more than 80 countries.

Its Raptor electronic noise reduction headset, launched in 2006, is used by soldiers to improve communications and to protect their hearing from high ambient noise environments, such as inside military vehicles and from sound blasts from roadside bombs.

Britain's Prince Harry used a Racal Acoustics headset (pictured) during his recent tour of duty with the British Army in Afghanistan.

ECI invested in Racal Acoustics in August 2005, backing the management team in a buyout from JF Lehman, a US private equity investor.

Since then, revenues have grown by 110 per cent from 2004 to this year, and profits in the same period are up nearly 150 per cent.

Throughout the period of ECI and management's ownership, the business has continued to invest heavily in research and development, most of this carried out by internal experts employed by the business.

The MBO team was led by Geof Eeles, chief executive of Racal Acoustics, along with Terry Buckley (sales director), David Watton (finance director) and Paul Watson (operations director) with other senior managers also taking part.

Ken Lindsay, director of ECI, says: 'Racal Acoustics is a great UK industrial success story. Over the last few years it has developed into a global market leader in its field on the back of a commitment to R&D, market-leading product design capabilities and a great management team.

'Racal Acoustics is exactly the sort of business that ECI likes to invest in - a strong and robust UK business with global leadership potential. We're passing on a great business to Esterline and are confident it will continue to grow and prosper as much under their ownership as it has under ours.'

Eeles adds: 'Racal Acoustics has grown strongly through private equity ownership and has benefited from the excellent partnership with ECI over the last three years. In this period Racal Acoustics has delivered record revenues and has positioned itself as a global leader in the field of military ancillaries. This has been achieved through the introduction of world beating new products such as our Raptor and Frontier ranges and through increased market penetration.'