First stage of two part MBO completes at interior design specialist
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The management team at warehouse and office interior designer and installer, Avanta UK, has acquired a stake in the business in the first stage of a two-part management buyout, in a deal supported by FRP Corporate Finance and Virgin Money.
The two main shareholders, directors Andrew Chipp and David Beattie, say the move represents the start of their managed exit from Avanta UK by selling part of the business to the well-established management team.
Chipp and Beattie maintain a significant minority stake and will remain at the forefront of the business for the medium term, working alongside the five-strong management team who have invested in the business.
Chipp said: “This deal enables the succession of the company to be passed to the management team in a way in which David and I will continue to lead the business, both in terms of our client relationships and day-to-day operations. Ultimately this means it is still business as usual and there is a bright future for all Avanta UK’s staff, customers and suppliers.”
Avanta is a leading designer and installer of tailored workspace and storage solutions, from offices and warehousing to logistics, engineering, food production, chemicals and pharma. Its clients include blue-chip household names such as Next, Jet2.com, Clipper Logistics, Johnson & Johnson, McLaren, Harrods and ASOS.
Headquartered in Leeds, the business operates nationally and has installation teams strategically located in key cities across the UK, including Manchester, Birmingham, London and Glasgow.
A team from FRP Corporate Finance’s Birmingham office, including Gary Hyem, Fahim Kassam and Matt Field, acted for the shareholders.
Hyem, director at FRP Corporate Finance, said: “This deal allows the shareholders to realise part of the value that they’ve created over the last 20 years as they work towards their ultimate retirement. Andrew and David were keen to pass the business on to their trusted colleagues in order to maintain the culture and core values of the company, and this is exactly the type of deal that enables that to happen. We’re currently looking at a number of other transactions with similar objectives.”
The debt-funded deal – known as a Vendor Initiated Management Buyout (VIMBO) – was funded by a term loan and working capital facility from Virgin Money in Birmingham led by directors Martin Aston and David Burgess.
Martin Aston, director, Business Direct, at Virgin Money, said: “Avanta has built up a strong reputation for the creative and personal approach it has to its projects and customers. The business has strong growth ambition to increase its market share across the industries it works in, while staying at the forefront of innovation and technology that gives their customers that competitive edge they need. By completing this VIMBO, the management team is future proofing the business, investing in its team and its continued success.”
Other advisers supporting on the deal included legal advisers Graham Spalding and Nicola Vernon of Lodders, Browne Jacobson and Crowe UK who provided financial due diligence on behalf of the lenders.
Graham Spalding, corporate partner at Lodders said: “It was great to work alongside Gary and Fahim and the FRP team, helping Andrew and David on their sale of a majority stake to the management team who I have no doubt will drive the business on with continued support from Andrew and David. We wish them every success for their future.”