Palatine backs buyout at Vernacare
VERNACARE, the £24m turnover Bolton-based manufacturer of single-use hospital products such as bed pans and washing bowls, has changed hands.
In a deal representing a first investment from its third fund, Manchester-based Palatine Private Equity has taken a majority stake in the company, which employs more than 200 people and sells to more than 50 countries around the world.
In its home market, Vernacare is the number one supplier, selling to 260 NHS Hospital Trusts, and has an established presence in the rest of Europe, Canada, Australia, and the Far East. The company is currently pursuing further international growth opportunities and has recently signed an agreement with a leading healthcare provider in China as part of the Chancellor’s recent trade visit.
The deal sees Palatine, which typically invests between £10m and £30m of equity, take a majority share in Vernacare. The firm will work with the management team, which is led by chief executive Matt Miller and CFO Paul Wright, to grow product sales and accelerate the expansion into overseas markets.
Vernacare was previously owned by a part of Lloyds Bank, once known as Bank of Scotland Integrated Finance (BOSiF).
Debt facilities for the transaction were provided by The Royal Bank of Scotland and NatWest (David Amos and David Jamieson).
Palatine partners Ed Fazakerley and Andy Lees led the deal, along with investment manager James Winterbottom. Fazakerley and Lees have joined the company board as non-executive directors.
Ed Fazakerley, said: “Vernacare is well established in the UK and whilst there remain further opportunities for domestic growth, our main focus will be on the continued expansion of the international side of the business. We have been highly impressed by the quality of the management team and their focus on developing both the product range and driving overseas expansion. We look forward to working with them in this next stage of the company’s development.”
Matt Miller, added: “The Vernacare system has tremendous benefits to both patients and carers. Not only is it an environmentally friendly solution, it also helps to reduce the risk of cross infection when caring for bed bound patients, an issue which has gained increasing prominence across the world in recent years.
“Working with Palatine will enable us to continue the development of our global footprint and placement of our products in high quality healthcare facilities worldwide.”
Clearwater International and a legal team from DLA Piper led by Yunus Maka advised the shareholders of Vernacare on the transaction.
Grant Thornton (Matt Brydon Smith, Gemma Hardy and Caroline Hadfield) provided advice to the management team and Baker Tilly (Colin Smyth and James Morris) provided tax advice to Palatine.
A team from Deloitte (Jodi Birkett and Paul Maddison) provided buy-side advice to Palatine along with tax due diligence and commercial due diligence.
Palatine’s legal advice was provided by Gateley while management were advised by Brabners (Tony Harper, Tamsin Eastwood and Lydia Edgar).
A team from EY, including partners Richard Harding and Noam Handler, provided vendor due diligence to support the transaction.
