MBO for welding equipment manufacturer
Parweld, the manufacturer and wholesaler of welding equipment has undergone a management buy-out.
Parweld is a leading global brand in arc and gas welding torches, welding machines, consumables and personal protection equipment.
It sells its products to a customer base comprising wholesalers and distributors worldwide from its headquarters and distribution facility in Bewdley, Worcestershire, and manufacturing facility in China.
To facilitate the transaction the management team, led by managing director Graham Perry, has rolled-over its entire shareholding with the support of a senior debt facility from HSBC UK, allowing it to acquire the business from majority shareholder Chris Parker who has also reinvested in the new vehicle, taking the position of chairman during a hand-over period.
The Parweld group, which has turnover of £16m, sells through a network of distributors in the UK and Europe as well as Africa, Asia Pacific and North America. It is best known for its range of Mig and Tig torches which include patented gas-flow technology.
Perry said:“We thank Chris for his leadership in establishing Parweld on a global stage and there will be no change to our existing strategy of providing top quality products and excellent service to our distributors around the world.
“We will continue to grow our customer base and have a number of new products to introduce to the market which we believe will drive further growth.”
The Cattaneo Corporate Finance team of Martyn Pilley and Matt Jones sourced and negotiated the debt package, working with a team of West Midlands advisers and funders to structure and deliver the transaction which involved reorganising the group structure and dealing with minority shareholdings.
Paul Bennett of George Green led on the legal aspects of the transaction with tax advice provided by Gavin Foster of Langard Lifford Hall. HSBC UK’s deal team, comprising Richard Newman, Max Godwin and Sam Owen, structured a full asset based lending facility plus term loan to support the deal and provide on-going working capital, with legal advice from Natalie Barnes of Irwin Mitchell.
Clare Lang of MFG Solicitors acted as legal adviser to the management team.
Pilley said: “It is rewarding to advise on a deal in which a combination of a good quality business and the shared values of both vendor and management, working with a tenacious group of advisers and funders, allows a structure to be devised and delivered across multi-jurisdictions to meet the objectives of the various stakeholders. We wish Graham and his team every success.”
James Dungey, HSBC UK relationship director commercial banking Midlands, said: “Parweld is a longstanding customer of HSBC, so we are delighted to support the next stage of its development with the MBO. Our strong relationship with the business made it an easy decision to support the deal. We look forward to working with Graham and his team as they continue to grow.”
