LDC backs Adler and Allan buyout

OIL and environmental services business Adler and Allan is planning for further expansion after undergoing a secondary buyout backed by private equity house LDC.

LDC has taken a significant minority stake in A&A, with the backing of senior debt facilities from HSBC.

The investment will support the organic growth of the Harrogate-based business, development of its existing product and service offering and deliver funds for future acquisitions.

The transaction provides an exit to Spirit Capital, which invested in the business in 2007 as Aberdeen Asset Managers Private Equity before its eventual spin-out. 

A&A, which was founded in 1926, provides a range of environmental and industrial services, including environmental services providing nationwide emergency response, offering flood and oil spill disaster relief as well as project led industrial services; technical services offering innovative asset protection services and consultancy and fuel services, which provides consultancy, maintenance and support to companies with fuel installations.

The group, which has a workforce of more than 450, serves the power, utility, telecoms, corporate and on-shore oil and gas sectors in the UK through its network of 24 depots.

For the year to September 2014, the business expects to record revenues in excess of £60m, up from £47.9m in 2013.

Since 2005, A&A has made a number of bolt-on acquisitions to expand its proposition. In 2009, the group acquired E&S Environmental Services and in 2011, A&A swooped for AJ Bayliss Petroleum Engineers.

The business is led by managing director Mark Calvert, who joined the company in 1993.

John Garner, director and head of LDC in Yorkshire and the North East, will join the board at A&A alongside investment director Dale Alderson.

Garner said: “During this process we have come to know the management team at Adler and Allan extremely well, having followed the successful development of the business over the last few years. We seized exclusivity on the deal only a few weeks ago and have structured a deal in a short time frame that will provide the financial firepower to continue its impressive growth in a developed and growing market.”

Mr Calvert said: “Since 2005, Adler and Allan has experienced a significant transformation and expanded to cover a range of integrated and vital environmental services to corporates. The financial and strategic support from LDC will enable us to drive further investment into our product development and nationwide depot network as we look to capitalise on a resurgent industrial sector and economy and take our business forward.”

Spirit Capital and management were advised by Stephen Griffiths, Rob Dunnett and Amy Bashforth at Rothschild and Debbie Jackson, Graham MacKenzie and Jo Stephenson at Walker Morris.

LDC was advised on the transaction by the corporate finance team at KPMG in Leeds, comprising Christian Mayo, Alex Hartley and Dan Smith.

A team from Squire Patton Boggs, including Peter Morley, Jayne Aarons, Tom Telford and Craig Pettit, was led by partner Jonathan Jones.

KPMG also provided financial due diligence and debt advice on the transaction.

Deloitte in Leeds provided tax advice to LDC and Deloitte in Newcastle provided tax advice to the management team of Adler and Allan.

LDC has now invested over £70m to back local businesses over the last 12 months, including a fresh capital injection for Gateshead-based Express Engineering in October 2013 and its support for the management buyout of Castleford-based Stroma earlier this year.