Palatine sells tyre management business for £55m
Palatine has sold Blackpool-based Direct Tyre Management (DTM) to Caledonia Private Capital for £55m.
The deal follows a record period of growth and investment for DTM, which works with major fleet operators to monitor and maintain tyres on their vehicles.
The management team led by Leigh Goodland, chief executive, has also reinvested alongside Caledonia to acquire 100% of the business.
Palatine originally invested a majority stake in DTM in October 2020, through the acquisition of NRG Group. It separated the group into two standalone businesses – DTM and specialist fleet solutions provider NRG Riverside, which it sold to Astatine Investment Partners in April this year.
In the last two years turnover has increased from £30m in 2021 to £60m.
Lancashire-based DTM
In the last set of published audited accounts to September 2023, DTM made EBITDA of £4,024.051 on turnover of £49,818, 417 and pre-tax profits of £3,879,680.
Founded in 2004 and now headquartered at Whitehills Business Park in Blackpool, DTM has over 100 employees and serves c.250 fleet customers with c.285,000 vehicles and c.1,300,000 tyres under management.
Enabled by a proprietary technology platform, which allows customers to maximise their fleet efficiency, compliance and output, DTM connects the vehicles it manages to a national network of over 3,500 service provider locations.
It uses smart technology to predict and prevent potential roadside failures supporting major fleet customers to reduce waste, increase vehicle safety and minimise costs, while being considerate to the environment.
Leigh Goodland
Leigh Goodland, Chief Executive of DTM, said Palatine had been a “highly supportive investment partner” and praised the Manchester-headquartered investor for its leadership on ESG performance. “We have grown rapidly from a £30m turnover to a £60m turnover over the last two years by acquiring new business organically and through our ability to be both agile and independent providing customers with insight and recommendations leading to the most sustainable tyre choice.”
Looking to the future, he added: “With Caledonia’s financial support, flexibility and long-term investment horizon, I am confident that we can build on the Business’ reputation for outstanding customer service and track record of innovation to bring new technology to our customers and take advantage of the significant growth potential in our chosen markets.”
Tom Leader, Head of Caledonia Private Capital, said: “We are proud to have become the new owners of DTM and to partner with Leigh Goodland and his team in the next stage of the company’s development. DTM’s consistent track record of revenue growth and cash generation, together with its market leading position, make the Business an exciting addition to our Private Capital investment portfolio. We believe there are multiple avenues through which to build further on the Business’ excellent record and to expand its range of services in the UK and other jurisdictions.”
Tom Wildig
Tom Wildig, Senior Investment Director at Palatine, said: “Under Leigh’s leadership and with the support of Executive Chairman Steve Dolton, DTM has grown to become the leading independent tyre management business in the UK, with excellent relationships with its staff, customers and suppliers.
“DTM is well placed to continue on its impressive trajectory. We’ve worked closely with the team to ensure the business is at the vanguard of fleet management technology and has thoroughly embraced the value of placing ESG front and centre in its growth strategy.”
Palatine’s advisors on the deal included: Michael Loudon, James Malcharek, Alex Fowler, Ffion Jones from Clearwater (corporate finance); Rebecca Grisewood, Kate Richards, Adam Noble from Gateley (lega); Jon Whiteman, Tim Perera from CIL (commercial due diligence); and Syedul Hussain, David Tomlinson from PwC (financial due diligence).
Caledonia’s investment in DTM was led by Theo Tizard, James Lander, Dan Lock and Joe Carter Hepplewhite.
Caledonia’s advisors included: Travers Smith (Adam Orr, Alex Dixon and Rachel MacAthur), OC&C (Nic Farhi, Mark Jannaway and Haleh Taghinejadi), Deloitte (Tim Haden and Sam Ward) and PwC (James Tubby and Josh Whittingham).
