Advisory firm reports ‘strong’ dealflow during Q1

Michael Reeves

Mid-market advisory firm Clearwater International, which has offices in Birmingham and Nottingham, says it has started the 2021/22 financial year with a “strong” dealflow completing 45 deals worth over €2bn in deal value in the first quarter.

During the last financial year, Clearwater International completed 138 deals placing the independent corporate finance house in 9th place in the pan-European financial advisors league table. The business achieved revenues of over €73m representing a small decline in fee income of just 1% compared to the previous financial year (2019/20).

Clearwater’s work with private equity (PE) has continued to grow, with 67% of transactions involving PE funds during the year, representing a 48% increase in PE activity. Notable key deals included: the UK team advising WJ Group, the UK’s leading supplier of award-winning road markings and specialist highway products and services, on receiving a majority investment from THI Investments, the Italian team advising private equity firm, advising LDC and management on the sale of specialist manufacturer ChargePoint Technology to Arcline Investment Management and advising LeMieux, a leading equestrian brand on its minority investment from mid-market private equity firm LDC to accelerate international growth and expand its product range.

With over 54 completed transactions, the European Debt Advisory team raised €1.7bn in debt finance. This debt was utilised by European businesses to support acquisition activity, refinance existing debt facilities, re-align capital structures, and support organic growth. The team provided support across the spectrum of sectors however, work within the business services, healthcare, TMT and certain areas of the consumer sectors made up 65% of activity during the year as these sectors proved to be attractive to lenders. Among the key deals for the team the UK team advised community pharmacy and distribution business Day Lewis Plc on a refinancing to provide a €146m (£125m) revolving credit facility.

“Significant” growth was seen across the business services and TMT sectors, closely followed by the consumer and industrials & chemicals sectors.

The TMT team experienced an “exceptional” year with a 69% increase in deal volume and a 78% increase in total deal value across the sector compared to the previous year. Key deals to note included the UK team advising Infinity Works, one of the UK’s leading digital transformation consultants, on its sale to global professional service company Accenture which marked an exit for investors Growth Capital Partners and advising Hippo Digital, a design-focused digital transformation consultancy on its minority investment from Growth Capital Partners.

Deal volume also grew by 28% in the Business Services team with a 72% increase in the total deal value during the year. Key deals for the team included: the UK team advising LDC on the merger of Lomond Capital and Linley & Simpson in a €109.3m transaction, to create a new national lettings and estate agency group and advising Ellis Whittam an employment law, HR and health safety provider on its sale to Marlowe, which marked an exit for its founder Mark Ellis and minority shareholder LDC.

Michael Reeves, CEO, Clearwater International, said: “The decision from World Health Organisation to declare the COVID-19 outbreak a pandemic in March 2020 was a significant moment and will remain a reference point in history as the effects continue to unravel. Whilst a number of transactions were put on pause, our team pivoted and adapted to continue to support our clients, especially through the initial period where stability was at the forefront of everyone’s minds.

“I have been delighted by the speed the team have adjusted to the new ways of working under new guidelines. I want to thank all of our people for their hard work this year. The team have showcased our values as a business throughout this period of uncertainty, remaining personable, adaptable and committed to both the business and our clients.

“Clearwater International has remained on its growth trajectory and has kept a strong foothold in the market experiencing growth across sectors and service lines this year which was certainly tough to imagine back in March. Already a few months in, I am confident that this financial year looks set to be a monumental year for the business with some significant developments already in motion.”

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