Yorkshire firm swoops for listed property company in £42.5m deal
Leeds-based venture capital firm Central Square Holdings Ltd (CSHL) is to acquire integrated property company Styles&Wood for £42.5m.
CSHL, based in Central Square on Wellington Street, is a large, UK-based business with specialisms in the sourcing, manufacture and management of life-cycle solutions for furniture, fixtures and equipment, through its existing equity interest in Southerns Group.
Southerns Limited is a Leeds-based furniture, fittings and equipment specialist which has grown quickly over the last two years after investment from Steve Parkin’s venture capital vehicle, CSHL (formerly Knaresborough Investments Limited).
Southerns is headed by Andrew Kendall-Jones, the largest shareholder in Southerns. In the year to June 2017, Southerns achieved pre-tax profits of £4m on revenues of £44m.
Kendall-Jones said: “Our business has grown rapidly both organically and by targeted strategic acquisitions. We identified the Styles & Wood business as an ideal business to partner with to further develop the range of services offered to customers, and to create an organisation capable of delivering services across the whole spectrum of property and facilities support services.”
Manchester-based listed company Styles&Wood said combining forces with CSHL’s business opened a new chapter for the Group, bringing significant growth opportunities and establishing an enlarged group, with credible reach across the full spectrum of support services to the built environment.
Aligning with CSHL will help to reinforce Styles&Wood’s client base, establishing a strong and predictable source of accessible business opportunities, the company said. The expanded group will also have a wide range of major corporate and public sector customers.
Under the terms of the offer, which is yet to be approved by Styles&Wood’s shareholders at a general meeting, each Styles&Wood shareholder will be entitled to receive 465 pence per share, which equates to premium of 24% for each share prior to the offer being announced.
On successful completion of the offer, the executive team of the enlarged entity will include Tony Lenehan, Phil Lanigan and Paul Mitchell, who will become chief executive, chief finance officer and chairman respectively of the enlarged Group.
Lenehan said: “In recent years, Styles&Wood has made significant progress with its diversification strategy, driving strong organic growth supplemented by value accretive acquisitions that have broadened the Group’s service line capabilities.
“We are confident that CSHL, with its commitment to the creation of a best in class offer within the property services market, is the right partner to take Styles&Wood to the next chapter of its growth story and we are excited about the future.”
Styles & Wood Group turnover in the year to December 2016 was £104.7 million with an Underlying pretax profit of £4.1m.
Immediately post-completion of the deal, both Southerns and Styles & Wood will be wholly- owned subsidiaries of CHSL. Key shareholders in CHSL will include the management team, and Central Square Investments LLP (“CSI”), which is an investment vehicle controlled by Steve Parkin.
Funding for the deal is being provided by HSBC and Tosca Debt Capital Fund. CSHL was advised by Numis and Pinsent Masons. Styles & Wood was advised by Shore Capital and Hill Dickinson.
