GVA Grimley builds for future with £40m LDC deal

COMMERCIAL property consultancy GVA Grimley has secured a
£40m investment from Lloyds TSB Development Capital (LDC), as
part of restructuring plan that will see it looking for
acquisitions and could lead to a stock market flotation of the
firm.

The move sees GVA Grimley, the seventh largest property
consultancy in the UK by revenue with 1,200 staff at 12 offices
including Leeds, converting from being a limited liability
partnership (LLP) into a limited company November 28.

Under the new structure GVA Grimley's 71 equity partners and
165 non-equity partners as well as a number of other senior
employees, will own the majority of the equity in the company, with
LDC becoming a substantial minority shareholder.

In the year to April 30 GVA Grimley, which can trace its history
back to 1827, generated total revenues of £148m, of which 67%
derived from consultancy services and around 50% were generated by
the regional offices.

Andrew Rodger, regional senior partner at GVA Grimley in Leeds,
said the move would further drive growth in the Yorkshire
region.

“As a firm, GVA Grimley have always been committed to the
Yorkshire region as demonstrated by our recent office move to City
Point.

“This announcement is a sign of the firm's further
commitment to driving our business forward in the region and will
help us to remain as one of the major players in the market
offering first class property advice to our clients.

“The restructuring will enable us to reward the existing
team that has contributed to our success and will help us to
continue to attract high calibre individuals to our teams.

“On a personal level Leeds and Yorkshire is a great place
to do business and we as a firm look forward to playing a
significant part in the development of the region,” added Mr
Rodger.

Bob Barnett, chief executive of GVA Grimley. said: “The
current 71 equity partners have enjoyed the benefits of over 15
years of sustained growth in income and profits arising from our
loyal client base and outstanding people. We have ambitious plans
for the future and we now wish to share our equity more widely to
include all of our 165 non equity partners who will be invited to
become shareholders in the new company.”

“We will continue to expand organically and by acquisition
and we anticipate that the opportunities that we will have to
achieve this growth will be larger than ever before.

“As an LLP it is difficult for us to acquire large
businesses without changing our capital and funding structure. LDC
will help facilitate our continued growth and their investment is a
testament to the diversity and stability of our business.”

Tim Farazmand, managing director of LDC in London, commented:
“The opportunity to invest in a business of this quality does
not come along very often. GVA Grimley has a strong consulting base
coupled with vibrant investment and transactional teams and we are
delighted to be supporting it in its next growth phase.

“We are confident that GVA Grimley's strong regional
offices, growing London presence, broad client base and high
proportion of stable consultancy revenue offer an excellent
platform for growth. We look forward to working with the enlarged
shareholder group to achieve further success.”

Steve Halbert, Head of Mergers & Acquisitions at KPMG
Corporate Finance, which has advised GVA Grimley throughout,
comments: “GVA Grimley now has a structure in place that will
enable it to continue to expand with the assistance of outside
capital but whilst retaining majority ownership for the
partners.”

GVA Grimley will continue to be run by its executive, which
consists of chief executive Bob Barnett, managing director Malcolm
Whetstone and finance director Donald Smith. Tim Farazmand and
Darryl Eales, chief executive of LDC, will join the board as
non-executive directors.