Deals round-up: Private equity deals increase; and more
THE value of private equity deals completed in the North West last year increased by 10% to £1.75bn (2010: £1.59bn), according to the Centre for Management Buy-Out Research (CMBOR).
The organisation said that the region also completed 44% more deals in 2011 – 26, compared with 18 in 2010. This bucked a national trend which saw overall deal values drop by 36% to £12.1bn, while the number of deals also fell nationally to 176 (183).
The survey showed that the region’s relative success was due to greater volumes of deals being completed in the lower-mid market sector – classed as deals with a value between £10m-£100m.
The biggest deal to complete was Merrill Lynch Private Equity’s £574m exit from Integrated Dental Holdings in March 2011.
Nine of the 26 regional deals were in the manufacturing sector, four were in business & support services, three were in food and drink and three were in financial services.
Steve O’Hare, partner at research co-sponsor Equistone Partners Europe, said: “Despite continued difficult trading conditions and uncertainty in the eurozone during 2011, private equity activity in the North West remained buoyant. The number of deals in the lower-mid market demonstrates the strength of the region’s SMEs and their success in attracting investment.
Ken Williamson, partner at co-sponsor Ernst & Young, said: ”It is great to see such a positive showing for the region in its PE deal activity – a major indicator of the strength of the region’s economy.
“The fact that the North West’s strengths are in mid-market deals up to £100million is no surprise at all and we should expect to see the same sectors – manufacturing, services, food and drink – continuing to be the most active.”
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THE Manchester office of corporate finance boutique Clearwater has advised on the sale of Nottingham-based coatings company RahuCat to US-based OM Group.
RahuCat is a developer of unique iron-ligand based chemistry for use in environmentally friendly coatings, composites and inks. The company was spun out of Unilever in 2006 with backing from the chemicals giant’s own venture capital unit, Unilever Ventures.
It was advised on the sale by the specialist chemicals team based at Clearwater’s Manchester office, headed by Philip Nuttall.
He said: “With EU legislation looming over the use of heavy metals in chemicals, RahuCat has developed much sought-after technology that will have a significant impact on the paints industry.”
Paul Smith, CEO of RahuCat, said: “This deal is the culmination of an excellent collaboration with OM Group and provides real evidence of the value of the emerging technologies.”
John Coombs, head of Unilever Ventures, said: “Rahu is a company with great potential but limited current traction, not an easy sell in the current M&A market.
“Clearwater demonstrated great understanding of the acquirer community and a deep set of relationships. We were delighted both with the thoughtful way they engaged with the task and the end result.”
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LIVERPOOL law firm Bermans has advised on a deal to sell petrol station forecourt operator Motor Fuels Group to a management buy-out team.
Motor Fuels Group owns and operates 58 petrol station forecourts throughout the UK and is based at Harrow in Middlesex. Its shareholders have sold the business to a management team backed by London-based private equity firm Patron Capital and Investec Bank.
The head of Bermans’ corporate team, Kieran Donovan, said: “We are delighted to have helped the shareholders realise their long term investment and to hand the business on to a very experienced new management team who have a great track record of working in the petrol retail sector.”
Bermans added that the deal meant its corporate team had a record-breaking year, advising on deals with a value of over £100m.
