Yorkshire party product manufacturer set to be snapped up
YORKSHIRE manufacturer of stationery and party products Concept Merchandise is to be acquired by AIM-listed LiteBulb.
The £5m deal will see Brighouse-based Concept be snapped up to help complement LiteBulb’s business, which designs, manufactures and distributes brands and products to the global retail market. London-based LiteBulb’s products are sold in more than 30 countries through blue chip retailers including ASDA, BHS, Tesco, Sainsbury’s, WH Smith, Halfords, Marks & Spencer, Morrisons, QVC, Next, Fenwick and Toys R Us.
Concept, which designs, develops and manufactures wrapping paper, gift tags, gift bags, gift cards and party products, supplies to national and international blue chip customers and works with companies including Mattel, Universal and News UK selling to retailers like Sainsbury’s, Tesco, M&S, WH Smiths and Debenhams. For the year ended December 2013, Concept recorded turnover of £7.5m and pre-tax profits of £1.1m.
LiteBulb is acquiring Concept for an initial consideration of £5m. £4.75m in cash and £0.25m in ordinary shares. There is a further deferred consideration of up to £2m based on achieving various performance criteria. The acquisition is expected to enhance the group’s sales over the next 12 months and have a positive effect on earnings.
Concept was formed in 1990 and was taken over in 2004 by husband and wife team Howard and Heather Partington. The business employs 17 members of staff.
LiteBulb is backed by Andrew Black, co-founder of Betfair (owns 8%) and serial small cap investor Nigel Wray (6.6%). This is LiteBulb’s sixth acquisition since listing on AIM in 2010 and its first foray into Yorkshire. LiteBulb has grown from a business with less than half a million pounds turnover in 2009 (initially selling “blinged up” rape alarms to M&S) to a business with turnover in excess of £20m this year and is expected to record its maiden profits in the year end numbers (to 31 December 2014).
Howard Partington of Concept Merchandise said: “We have enjoyed significant success over the last few years and supply our gift wrap ranges to blue chip companies across the UK. Our vision has always been to deliver first class products and we are sure the acquisition by LiteBulb will take the business on an exciting new journey to expand under their extensive licensed ranges.”
Simon McGivern, CEO of LiteBulb, said: “The acquisition of Concept is a great win-win for us both, as well as a win for the customers and retailers that we all work with. Concept is a well-run and profitable innovator in gift wrap, bags and accessories and this addition will complement our growing business and add to the wide range of categories that we are able offer the top retailers.”
The deal saw the Leeds-based Mazars’ corporate finance team, led by Oliver Hoffman and Will Brennand, act as advisors to Concept on the sale alongside legal advisors Jonathan Asquez and Duncan Firman from Gordons.
Oliver Hoffman, Leeds managing partner and national head of corporate finance at Mazars said “Concept has a strong track record of success and there is a fantastic fit with Litebulb who continue to deliver on their impressive growth strategy. I am delighted to have helped Howard and Heather to ensure the successful sale of the business they have worked so hard to build and provide an exciting new era for the business moving forward.”
Completion of the deal is set to occur mid-December.
