Air Energi sold in secondary buyout
AIR Energi Group, the Manchester recruiter that specialises in the oil and gas industry, has been bought by a management team with backing from LGV Capital.
The transaction completes a quartet of major recruitment-related deals this year: the take-private of Salford-based Morson, a management buyout at Fircroft, and the £234m sale of NES International, announced earlier today.
The LGV acquisition at Air Energi represents an exit for Manchester-based Palatine Private Equity.
The value of the deal was not disclosed but the business was expected to fetch between £80m-£100m. Palatine said it had tripled the value of its initial investment in three years.
Managing partner Gary Tipper, pictured, said: “Air Energi is one of the leading businesses in its sector, with a truly international footprint. Its growth in the past three years, both organic and acquisitive, leaves it well-positioned for the future. I wish the team all the best in the future and with their partnership with LGV.”
Under the terms of the deal LGV has acquired a majority interest. It was supported by HSBC, which provided a senior debt package and working capital facilities worth £61.5m.
Air Energi’s chairman Ian Langley said: “We are very pleased to complete this buyout transaction following a positive investment experience for Palatine and all of the shareholders in the business.
“We are looking forward to working with LGV as our new partners in the future. Our market continues to offer exciting opportunities for growth which we will seek to exploit as well as further enhancing our excellent quality of service to our clients.
“LGV’s equity investment positions Air Energi perfectly for continued future growth. Our strategy is, with LGV’s support, to become a half a billion-dollar turnover business by the end of 2013 and to doubling profitability again within the next five years.”
Mr Langley added: ”The Air Energi management team led by chief executive Duncan Gregson and finance director Ken McPherson and our advisors worked for almost twelve months to complete this transaction and, in the case of management, also surpassed group performance targets.
“Without their dedication in tough economic conditions, we wouldn’t have concluded this transaction today. I would also like to thank HSBC who were able to deliver an appropriate debt package, not only to our UK business, but to all our operations globally.”
Air Energi’s advisors for the deal were Deloitte Manchester, led by Andy Westbrook and Oliver Tebbutt, supported by Ryan Hallworth. Rebecca Grisewood and Kate Richards from Gateley solicitors provided legal advice to management and Palatine throughout the transaction. HSBC was represented by Alan Rigby and Noel Jones.
Last year the firm, which has 200 staff, made pre-tax profits of £8m on sales of £200m. Palatine is understood to have paid £10m for a minority stake when it invested in 2009. London-based LGV focuses on deals with a value of more than £25m. In the North West it has invested in pub chain Amber Taverns and sports equipment retailer Snow + Rock.
LGV director Zoe Clements said: “The business is well positioned to take advantage of the continued forecast growth in the oil and gas sector. We look forward to supporting the team as they continue to provide a high quality service to both the oil and gas operators and their technical contractors.”
Alan Rigby, HSBC’s head of corporate banking in the North West, said: “The funding in support of today’s secondary management buyout reflects our confidence in both the Air Energi senior management team and the business’ future prospects for sustainable business growth.”
