Character building buyout for Palatine
PALATINE Private Equity has backed a secondary buyout at Character World which values the branded bedding firm at more than £30m.
The deal provides an exit for RJD Partners which backed Mark and Danny Schweiger when they bought out their father Tommy in 2008.
Palatine has paid £16m for just over 50% of the Cheadle company which made pre-tax profits of £4.2m on sales of £29.2m in the year to December 2013. The Royal Bank of Scotland, the firm’s current banker, has provided debt facilities worth £22m.
Character World has licenses for a range of brands owned by the likes of Disney, Lego, Hasbro, Mattel and Warner Brothers. It supplies retailers such as Next, Tesco, John Lewis, Argos, Asda, and B&M Bargains. It is currently targeting overseas growth.
Danny Schweiger, joint managing director, said: “We’re delighted Palatine will be backing Character World in the next phase of our exciting journey. My brother Mark and I will continue to run the business and our focus going forward will be on growing our UK business whilst becoming a successful international company. The future is full of opportunities that we intend to grasp.”
Andy Lees, partner at Palatine Private Equity, said: “This is an incredibly exciting time for the business after securing a number of quality licences with high-profile brands in Europe tobuild on the market leading position in the UK. The management team has done a fantastic job in growing the business over the past few years and it’s a pleasure to be working with them as they gear up for international growth.”
Mr Lees will join the board along with Palatine investment manager James Winterbottom.
Clearwater International advised shareholders of the company Partner, Gareth Iley said: “With the business increasingly focused on Europe, Character World is facing exciting opportunities and significant growth potential. It is another example of an outstanding management team leading a UK consumer business to be a success internationally.”
Grant Thornton provided corporate finance advice to Palatine, while a team led by Rebecca Grisewood at Gateley provided legal support. Jon Schofield and Andy Dodd of Dow Schofield Watts and Ian Gillis of Hill Dickinson advised the management team. Other advisers included The Berkeley Partnership (operational due diligence), The Quinn Partnership (management due diligence), PwC (commercial due diligence), Grant Thornton (financial due diligence and tax), Marsh (insurance due diligence) and Baker Tilly (tax due diligence).
