Laundry deal proves international buyers are seeking growth opportunities
A historic high-end hospitality laundry specialist based in West Cumbria has been sold to a Canadian giant of the laundry world in a £24.1m deal.
Shortridge, which was founded in 1845, has been bought by K-Bro Linen which has expanded its share of the £1.4 billion UK commercial laundry and textile rental market.
K-Bro also owns Fishers Laundry Group, the commercial laundry and textile rental provider covering Scotland and the North East of England, which it acquired in 2017.
Shortridge was acquired for £24.1 million (approximately C$41.2 million), on a cash-free, debt free basis with a further potential earn-out of £2.0 million if management achieve certain targets for the 12 months through September 2024.
Matthew Flower, partner at FRP Corporate Finance, who advised on the deal said: “This deal represents a perfect fit for both parties. Not only does it allow the well-established and respected Shortridge name to live on and secure the future of its employees, but it also means that K-Bro can diversify its customer base, providing a platform for expansion further south into the UK.
“It proves that there is sustained interest in high quality UK companies from international buyers as greater economic stability encourages more businesses to target growth opportunities through M&A.”
Shortridge’s last twelve months’ revenue for the period ended March 31, 2024 was approximately £12.5 million. The transaction includes the freehold and leasehold real estate for Shortridge’s laundry processing facilities. The acquisition is being funded entirely from K-Bro’s recently increased syndicated debt facility.
Shortridge is headquartered in Workington, with laundry processing sites in Lillyhall and Dumfries and a distribution centre in Darlington.
Linda McCurdy, President and Chief Executive Officer of K-Bro, said: “While our original plans to grow our presence in the UK were interrupted by the Covid pandemic, we have stayed on the alert for further growth opportunities in the UK, and I am excited by the potential that this acquisition presents for us and for Shortridge’s customers. We share the same values as Shortridge, so the cultural fit is strong and the business has found a good home as part of the K-Bro family.
“This is a great opportunity for us to diversify our customer base in the UK and to position our combined UK business for more growth as we look to extend K-Bro’s geographic reach further south into the UK.”
Peter Semple, Shortridge Business Director, said: “This is a good news story for Shortridge and our customers as we join the K-Bro family with the resources and the vision to help us grow the business further while continuing to look after the interests of our valued customer base. K-Bro’s experience, coupled with Fishers’ strong reputation and track record here in the UK, make for a formidable team and we can look forward to an exciting future together.
Burness Paull LLP and Stikeman Elliott LLP acted as legal advisors to K-Bro.
FRP Corporate Finance advised Shortridge. The FRP team was led by partner Matthew Flower, director Joel Coulson and assistant manager Liam Merritt and designed a bespoke process to select a strategic buyer for the business.
