Yorkshire Deals Review

Richard Goldsack, partner Clearwater International

As the UK begins one of its biggest ever vaccination drives during a national lockdown, businesses once again must adapt to the latest measures. However, latest deal activity in Yorkshire shows that companies continue to pull out the stops against the hurdles presented by Covid-19, says Clearwater International partner, Richard Goldsack.

As the world welcomes the news of successful vaccines for Covid-19, so we should applaud those Yorkshire companies playing their own significant part in combating the disease.

For instance, in November speciality chemical business Croda International signed an agreement with Pfizer to supply novel substances, called excipients, in the manufacture of its vaccine. Excipients play a central role in the drug development process in terms of the formulation of stable dosage forms and in their administration.

However, despite the vaccines, testing for Covid-19 will of course continue to play a major role. In December, off-site construction specialist Premier Modular saw a contract to provide modular buildings for Covid-19 testing in the UK doubled to 50 sites across the country. In recent months, the company has invested £7m in its hire fleet to meet the increasing demand for its buildings in the healthcare, infrastructure, education and construction sectors, so allowing for a rapid response to contracts such as Covid-19 testing.

Keeping with infrastructure, our Clearwater International team in Yorkshire were delighted to advise surfacing, engineering and external environment maintenance business NMC Group on its sale to GRITIT, a winter services compliance and grounds maintenance company which delivers gritting, snow clearance, grounds maintenance and civil engineering solutions to commercial properties.

The deal doubles the size of GRITIT and creates a £50m market-leading provider of external infrastructure compliance services, it is also its third acquisition since Total Capital Partners invested in the business two years ago. Of particular note is how GRITIT has developed high-tech deployment software that uses real-time meteorological and algorithmic data to automatically mobilise operatives and workforces on a demand-led basis.

Equity investments
Elsewhere it was a busy December for equity investment in the region. A standout deal saw Chameleon Technology, the Yorkshire-based international smart energy technology company, complete an MBO to support its ambitious growth strategy, which has been backed by Shard Credit Partners.

Debt transaction
In another deal, Sheffield-headquartered EVO Group of companies has secured a £90m financing facility to support its plans for the future with Breal Zeta and Leumi ABL. The EVO Group is the largest operator in the £18bn business supplies market and is backed by Leeds-headquartered private equity investor Endless.

Multiple deals
In the first of a number of significant transactions to end 2020, lettings agent Linley & Simpson launched itself in Sheffield after taking over the rental portfolios of two independent agencies in the region – Lewis Wadsworth and Sheffield Residential. The deal has transferred around 750 homes across Sheffield into Linley Simpson’s management. Linley & Simpson also acquired the rental portfolio of Dacre, Son & Hartley in Ilkely transferring 600 homes.

Finally, for Linley & Simpson, Clearwater International advised its existing private equity investor LDC on backing the merger between Lomond Capital and Linley & Simpson in a £100m transaction, creating a new national lettings and estate agency group. The new group brings together some of the UK’s strongest high street brands and as a combined business, will now look to strengthen its nationwide network through complementary and organic growth.

On a final note, pet food manufacturer Inspired Pet Nutrition has been sold to a new private equity owner. The business, which is based in Dalton, near Thirsk, was established in 1923 and produces pet foods under the Wagg, Harringtons and Nineteen 87 brands. The founding family will retain a significant interest in the business, and will continue to support its future growth plans.

Indeed, with the vaccine breakthrough significantly boosting investor appetite for doing deals in recent weeks, we expect a busy few months ahead for equity transactions in particular as the market gains renewed confidence and momentum as we continue in to 2021.