MBO for £55m logistics firm

A NICHE logistics provider  has completed a management buyout, with NorthEdge Capital investing an undisclosed eight-figure sum for a significant majority stake.

Liverpool-headquartered Abbey Logistics was set up more than 25 years ago by the Lucy family, specialising initially in the liquid food ingredients transportation market, with more recent diversification into the bulk powder market.

Long-standing relationships with a number of pan-European blue chip customers have been built up over the years enabling Abbey to grow to become a market leader in the food ingredients transportation market.

The company, led by chief executive Steve Granite, has demonstrated strong year-on-year growth over the past five years with turnover more than doubling from £20m to more than £55m in the current financial year following a number of acquisitions and large contract wins.

The business employs over 450 staff and operates from nine UK sites including Wirral, Hull, Manchester, Knowsley, Middlewich and London.

NorthEdge’s investment, supporting Granite’s MBO, is its fourth deal this year and is the second investment from the recently raised £300m Fund II.

The funding will support the business as it targets growth with new and existing customers, as well as exploring a number of acquisition opportunities that management has been progressing in parallel to the MBO with support from NorthEdge Capital.  

The deal will provide a full exit for the founding family and the business will continue to be led by Steve Granite as chief executive and Dave Coulson as commercial director.

Steve Granite, chief executive at Abbey Logistics, who has been with the business for more than 20 years, said: “It is an exciting new chapter in the company’s life and we are very much looking forward to continuing the successful journey we have experienced to date.

“Our customers and employees will see the benefit as having a new partner on board will enable us to develop our business and continue growing from solid foundations.  Through organic and acquisitive growth, Abbey will become the market leader in both the liquid and powder transportation markets in the UK.”

NorthEdge director Jon Pickering led the transaction, with support from investment manager Dan Matkin and portfolio director Ben Wildsmith. Private equity experienced chairman Ian Kelly joins the board at completion.

The board will be further strengthened post completion with the appointment of an industry veteran who will act as non-executive director and a logistics specialist group chief financial officer who has been identified pre investment.

Jon Pickering, director at NorthEdge Capital, said: “[Abbey Logistics] fully understand the specialist logistics market they serve having carved out a niche by distributing bulk powders and liquids for the food ingredients markets.

“The company has demonstrated growth through a number of major contract wins and targeted acquisitions and this strategy will continue going forward with our support and follow on funding. We are pleased to have provided an exit opportunity for the founders and are looking forward to working with Steve and Dave as we target further expansion across the UK and Northern Europe.”

The company was advised by EY (corporate finance) and Napthens (legal). NorthEdge was advised by a number of regional advisory firms including BDO (corporate finance), Pinsent Masons (legal), Graphene Partners (commercial due diligence) and EY (financial due diligence). KPMG provided support to newco on IT due diligence and tax structuring, Quinn Partnership performed management due diligence and Vista provided insurance due diligence.

Mark Clephan in the corporate finance team at EY, said: “Abbey Logistics has a reputation of ‘going the extra mile’ for their clients, which has led to continued growth and expansion since its formation in 1990 by the Lucy family. Over the past five years, thanks to a strong management team, the company has seen strong growth following a number of acquisitions and large contract wins.

“It was important to find the right buyer for the founders, Steve and Mark Lucy, so that the existing management team were able to continue to drive the company forward. The funding from NorthEdge Capital will enable them to do just that.”