Wheeldon plans for further growth following Capita deal
YORKSHIRE entrepreneur Gavin Wheeldon was looking forward to the festive break having just completed the sale of his business to outsourcing company Capita for up to £67.5m.
The deal, which was announced on Friday, will see Mr Wheeldon gain an initial £7.5m upfront, with the potential to earn a further £60m over the next four years if it achieves the financial targets that have been set for it.
“It will keep the missus happy for a while,” joked Mr Wheeldon, who started the business from his bedroom in Huddersfield.
The 35 year-old added that it was the opportunities that the deal with Capita presented that appealed to him as much as the potential rewards.
“There’s a big incentive but irrespective of the money I’m quite excited about it,” he said.
“Growth is what interests me – the thrill of the kill. Now that we’re part of Capita and have access to their balance sheet we’ve got the resources to go out and make more acquisitions.”
He said that the deal had taken just 12 weeks to complete from an initial approach from a corporate financier via social media site LinkedIn.
“I spoke to them and within a few days I was in front of the chief operating officer and the acquisitions director.
“The COO came for a look at our operations here and a week later I met the chief executive. We moved very quickly into due diligence.”
Although Capita typically looks to integrate new acquisitions within its existing divisions, ALS, which is now based in Delph in Lancashire, is being left as a standalone division with Mr Wheeldon reporting directly to the board, which he said was a mark of respect for the way the firm operates.
“I am very proud of what I’ve achieved. Sometimes you look out of the office and you see all of the staff who are working for you and you have to pinch yourself.
“There’s still a few members of staff who have been here for the entire journey.”
Mr Wheeldon’s web-based translation brokerage has cut costs for purchasers of translations services considerably – it estimates that the Ministry of Justice could save up to £60m a year through using its service over a five-year framework deal agreed in August.
He also said that its model allowed it to acquire traditional translation businesses and deliver the same service to clients much more efficiently.
“We acquired a translation business that had a turnover of £1m and employed seven people. We were able to deliver the same business with just one person. This is a good opportunity to buy and build.”
The deal also provides an exit for the Government-backed Capital for Enterise Fund, which is managed in the north of England by Maven Capital Partners. It invested £1.5m in 2010 to support the firm’s growth, and said it has achieved an internal rate of return (IRR) of 40% on its investment.
Maven Capital Partners’ investment manager Jonty Hall said: “We are delighted that Capita has acquired the business and believe it is the right partner to allow ALS to continue its growth strategy.”
ALS was advised on the deal by the Leeds office of Squire Sanders Hammonds, while DLA Piper advised Maven Capital Partners.
