Steel company targets 25% revenue rise after MBO

Sheffield-based steel product manufacturer Daver Steels, which is a major suppler to the Crossrail project in London, is targeting a 25% revenue increase after undertaking a £1.2m management buyout.

Supported by funding from NatWest, the deal, which includes a combined refinancing package from Royal Bank of Scotland Invoice Finance and Lombard, will see current technical sales manager, Lee Stones, and operations manager Robert Butts, take leadership of the company.

The business employs 35 people at its factory in the north east of the city.

Stones joined Daver Steels four years ago from Severfield Watson Structures, while Butts was recruited from ECS Engineering Services in April this year.

Since joining Daver Steels, Stones has been an integral part of managing the business through a significant period of growth, increasing sales from £1.8m in 2014 to £3.2m in the year to December 2016.

Among its successes is a multi-million pound contract on the Crossrail Project in London, where the company is supplying hundreds of complex stainless steel structural support frames.

Stones said: “This is a new phase for Daver Steels, as we set out a fresh strategy for the company. We’ve achieved a significant amount of growth over the past four years, boosting revenues and taking on some high-profile projects. Our aim is to build on that by targeting a turnover of £5m over the next 12 to 24 months.”

Tony Wilson, senior relationship manager at NatWest, added: “Sheffield has a long tradition in the steel industry and companies like Daver Steels are building on that foundation in a new era. Supporting Lee and Rob was a no-brainer – we could see the strengths of the business, as well as their passion for the industry.”

Daver Steels was advised on the deal by Peter Wilmer of Hawsons Chartered Accountants.

Neil Large of Lupton Fawcett acted for NatWest.