Harrington Brooks sold to RJD
INFLEXION Private Equity has completed the sale of its investment in south Manchester-based debt management firm Harrington Brooks.
RJD Partners has taken a majority stake in the company for an undisclosed sum. It has backed the existing management team led by chief executive Matthew Cheetham and finance director Terry Sweeney.
Mr Cheetham is a former chief executive of Holidaybreak’s camping division who joined the firm in 2007. Mr Sweeney was part of the original management buy-in team which was backed by Inflexion when it invested in a £15m deal in 2005.
RJD Capital Partners will now own a stake of 70% in the business, with the management team retaining the remaining 30%. Funding for the business will continue to be provided by PNC Business Credit.
Harrington Brooks has completed a number of acquisitions of back books of competitor IVAs including Debtsure and Debtmatters over the past 18 months as it has sought to become a consolidator in the sector. The company, which had sales of £9m in the year to March 2009, has grown sales to more than £29m to March 2012. It currently has around 37,000 customers and 380 employees.
Mr Cheetham said that a lot of its recent growth had come “from our own efforts” as it expanded the range of services offered to clients.
John Dillon, managing partner of RJD Partners said: “We are delighted to back a well-established and proven management team in the buyout of Harrington Brooks.
“With UK household indebtedness continuing to rise, there is significant potential for the company to build on its excellent growth track record in a highly fragmented market place.
Mr Cheetham added: “We were impressed by RJD’s in-depth understanding of the debt management sector and the exciting potential that this dynamic market presents.”
RJD Partners was advised on the buy-out by corporate Clearwater CF and Eversheds, with due diligence provided by Grant Thornton, KPMG, GK Political, Deloitte and Quinn Partnership.
The management team were advised by DLA and KPMG, while Inflexion was advised by Dow Schofield Watts and Cobbetts.
