West Midlands corporate deals review in association with Clearwater International

As we head into Summer (although someone should really tell the weather that!) deals levels seem to have plateaued in the Midlands with the Business Desk recording a total of 29 deals in May compared to an average of 33 a month over the last 5 months. It was a very strong month for consumer which accounted for almost 42% of deals.

Cycling is becoming somewhat of a British sport – threatening to take the coveted spot from Cricket, and with what seems like ever growing popularity, continues to be attractive to corporate and investors alike. Deals in the space over the past year alone include ECI’s purchase of Evans Cycles, Ashley Ball’s acquisition of Orange Mountain Bikes, Hero Cycles purchase of Avocet Sports, and the merger of Wiggle and Chain Reaction Cycles.

Joining in on the activity last month was Halfords, who purchased online bike and cycling specialists Tredz and Wheelies in an attempt to deepen its involvement in the cycling market. Halfords have been rolling out their specialist cycling fascia, Cycle Republic, and this acquisition fits with its strategy of attracting the serious cyclist. The purchase is the second in the space for Halfords following its acquisition of Boardman Bikes in June 2014. It’s not just acquisitions that Halfords have completed, having recently announced just last week that they will be launching a new bike range with double Olympic gold medallist Laura Trott.

Chinese businessman Dr Tony Xia announced his purchase of Aston Villa Football club just one month after the Birmingham-based club was relegated from the Premier League – for the first time in 29 years. The deal marked the second time in just over six months that Chinese investors have put money into English football; a consortium of investors brought a stake in City Football Group, the owners of Manchester City, in December 2015.

The claret and blues new owner became a fan of the club many years ago and is planning a return to the Premier League with grand ambitions to make it the most famous football club in China and return it to European football. The club won the coveted title back in 1982.

The acquisition by Dr Xia means that both Birmingham based football clubs are now in Chinese hands – Birmingham City was acquired in 2009 by Carson Yeung, although the reign of the businessman is set to be brought to an end.

Herefordshire-based private equity backed Tyrrells, manufacture of potato and vegetable crisps, completed its second major international deal of the last 12 months with the purchase of German producer Aroma Snacks, maker of organic crisps and owner of the Lisa’s Hand-Cooked Chips brand.

The deal follows the purchase of Australia-based snacks company Yarra Valley Snack Foods in August last year, which saw the crisp giant take its first step into international manufacturing. With the addition of Aroma, Tyrrells now operates five manufacturing sites globally.

Backed by Bahrain-based Investcorp, who paid £100m for the company three years ago, Tyrrells is now a £60m turnover business, exporting to 37 countries, and enjoying robust growth driven by international expansion via M&A. Already established as the UK’s fastest growing hand-cooked crisp and snack brand of scale, the company intends to become the largest purveyor of premium snacks in the world.

With an average of over 2.5kg of crisps consumed per person per year, the UK has the highest crisp consumption per capital in the world, and it is therefore no surprise that the market remains attractive. Last year mid-market private equity firm LDC backed the £35m management buyout of snacks business, Seabrook Crisps.

In another cross border deal, historic paint brush manufacturer, LG Harris, was acquired by multi-billion pound Norwegian group Orkla, for £55m.

Founded in 1928, LG Harris is one of Bromsgrove’s oldest family companies, a truly respected and well-known name in the DIY market. Although a majority of sales come from the UK market, LG Harris also exports its products and has become renowned around the world for producing quality paint brushes.

With the purchase Orkla significantly strengthens its presence in the UK expanding its portfolio into the DIY sector. Brands already owned by the conglomerate include Jordan, Spekter and Hamilton.