LDC backs ambitious MBO team with £20m investment

Guy Bagshaw

Mid-market private equity firm LDC has invested £20m to back the management buyout of Shield Group International from global testing, inspection and certification group Kiwa.

SGI, formerly known as Kiwa Compliance International, is an international environmental testing, inspection and consultancy business.

LDC’s Manchester team has invested to support the existing management team as it accelerates its growth strategy.

Led by chief executive Frank-Maarten Gribnau, UK managing director Gavin Hartley and European managing director Alain Jeger, SGI is a market leader in environmental compliance and specialises in health and safety services in relation to legionella, water safety, asbestos and other hazardous materials.

The business, which is based in Ross-on-Wye and has an Altrincham operation, records revenues of around £50m annually and employs more than 600 people across six countries, including the UK, the Netherlands, Belgium, Norway, France and Spain.

SGI supports a broad range of customers across the energy, industrials and public sectors.

It provides an end-to-end service which includes certified risk and commercial audits, monitoring programmes, remedial recommendations and project management, in addition to training and education to help its customers remain compliant with health and safety laws.

As part of the deal, Mark Silver joins SGI as non-executive chairman and Paul Horton joins as chief financial officer.

With more than 30 years’ experience, Mark founded inspection and testing specialist Inspicio, which he went on to grow to an 8,500-employee business that operates across 130 countries.

Paul brings more than 20 years’ experience as a senior financial professional in the manufacturing sector having supported the growth of private equity-backed businesses.

SGI now plans to invest in its current portfolio of services to accelerate organic growth and also add complementary service lines through a targeted buy-and-build strategy in its chosen international markets.

The investment was led by LDC’s Guy Bagshaw, Jonathan Bell and Kelsey Bayley – both Guy and Jonathan will join the board as non-executive directors.

Guy Bagshaw, Investment Director at LDC in Manchester, said: “SGI addresses critical, regulatory-driven health and safety-related issues for its customers, supporting the wellbeing of their employees and protecting the surrounding environment.

Frank-Maarten, Gavin and Alain have established the leading business in its field, not just here in the UK but across Europe also, and we look forward to working closely with them as they embark on the next stage of their journey as an independent business.”

Frank-Maarten Gribnau said: “It is our goal to develop a complete suite of services for health and safety and environmental testing, inspection and consultancy, and with LDC on board as our investment partner we have a real opportunity to do just that.

“Regulatory developments and the need to be compliant will continue to drive new growth opportunities and the strategic support and financial firepower of the team at LDC will help us to deepen our service portfolio across the countries and regions we operate in.

“This is a really exciting time for all of us at SGI and we’re looking forward to extending our global reach, so we can continue to bring our market-leading services to customers worldwide.”

LDC’s investment in SGI marks the sixth corporate carve-out the firm has backed in 15 months, following its partnerships with Precision Micro, Martin Audio, Retail Asset Solutions Group, NBS and BWML.

The deals have a combined enterprise value of more than £165m.

LDC was advised by Manchester-based advisers including GCA Altium, DLA Piper, Deloitte, KPMG and Intechnica.

Shield Group International’s management team was advised by Harrison Clark Rickerbys.

Debt facilities were provided by M&G, with working capital debt facilities provided by Barclays.

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