deal team times midlands - pwc uk...2 midlands deal team times january 2014 pwc midlands deal team...

www.pwc.co.uk/midlandsJanuary 2014

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Deal Team TimesMidlands

2 Midlands Deal Team Times January 2014

PwC Midlands Deal Team advise on £2.3bn of completed deals during 2013 A busy end to the year contributed to a very successful result with the Deals business advising on in excess of £2bn of Midlands deals in 2013.

Matt Waddell0121 232 [email protected]

Highlights of the year include the sale of epyx to Fleetcor Inc and Lil-Lets to Premier Foods (Pty) Limited where we were able to leverage our deep PwC sector contacts and the PwC global network to deliver strategic trade buyers for both businesses. We are delighted to have been able to support our long standing relationships and help the companies build their strategic value through investment internally and externally prior to the sales process.

We have also supported a number of our clients in accessing the PE finance necessary to develop and grow their businesses. In particular, assisting both Node 4 and Joules in gaining investment from LDC in the Midlands and Dr Martens and AIM Aviation in their deals with Permira and TowerBrook respectively.

Looking forward to 2014 we expect to see a continuing high level of interest from both trade and PE but a key driver of increased deal activity in 2014 will undoubtedly be IPO activity. IPO activity doubled in 2013 and current interest in this, as a means of accessing liquidity, is driving a significant amount of IPO activity scheduled for the first quarter of 2014.

Matt Waddell, partner and head of Deals at PwC Midlands commented:

The general economic mood has been increasingly positive through 2013 with key indicators showing signs of improvement particularly in the second half of the year. Businesses have adapted to the ‘new norm’ changing their strategy and operations to be flexible and agile to economic opportunities and shocks.

We have been actively involved in the full range of deals activities including trade sales to international buyers and investment by PE to facilitate growth in existing locally based businesses.

We continue to see strong demand from international trade buyers. As a team we have worked closely with Midlands businesses to ensure we have driven premium exits for the stakeholders in both entrepreneurial and private equity clients.

“ We are delighted to have been able to support a number of our long established clients through very successful deals in 2013. Going into 2014 we expect to build upon this level of activity as the IPO market offers an increasingly interesting alternative to the trade sale or PE option.”


TowerBrook acquires a controlling stake in AIM Aviation from LDC PwC Midlands Transaction Services team provided vendor financial due diligence support in relation to TowerBrook Capital Partners acquisition of a controlling stake in AIM Aviation from LDC.

AIM Aviation designs, engineers and manufactures cabin interiors to provide added value and vital differentiation for the world’s leading airlines and OEM’s including Airbus, Boeing and manufacturers of regional aircraft. Operating from its base in the UK, services of AIM Aviation include exterior and interior composite assemblies, stowages and galleys, premium monuments and bar units, lounges, sky shops and seat modules.

The PwC team was led by Russell Worrall and supported by Helen Ward, together with M&A tax partner Chris Pedley.

Helen Ward commented:

Helen Ward0121 265 [email protected]

“ We were delighted to support this transaction. The business has developed strongly since its acquisition from AIM Group plc in 2010 and we look forward to following the business as it executes its next phase of development.”


Joules transaction marks a hat trick of retail and consumer deals for PwC Midlands LDC, the UK’s leading regional mid-market private equity house, has invested £22m to take a minority stake in Market Harborough-based lifestyle clothing brand Joules. The transaction, which completed in November 2013, marked a hat trick of deals for PwC Midlands’ Retail and Consumer Deal Team in the last quarter of 2013.

PwC provided financial, commercial and tax due diligence support on the Joules transaction, which will provide the clothing brand with the platform to expand further within the UK and internationally.

PwC Midlands’ role in this high-profile deal follows its recent involvement in two other retail deals in Autumn 2013 with the retail and consumer deal team also advising on the Dr.Martens and Lil-Lets transactions, both international brands based locally in the Midlands.

The team supported private equity firm, Permira on its acquisition of Dr.Martens, providing a broad range of services including financial and tax due diligence, tax structuring, SPA support as well as pensions advice.

PwC Midlands also advised private equity house, Electra Partners, on the sale of Lil-Lets, the feminine hygiene business based in Solihull. The Retail and Consumer Deal team provided corporate finance advice, and financial, taxation and pensions due diligence support to Electra during the sale to Premier Foods (Pty) Limited, a major South African based manufacturer and distributor of fast moving consumer goods.

Matthew Lister0121 265 [email protected]

“ This hat trick of deals demonstrates a real resurgence in merger and acquisition activity in the Midlands’ retail and consumer sector. We’re seeing companies operating in this space, particularly those with a global presence, becoming increasingly attractive to corporate and private equity investors.

With a dedicated team of retail and consumer deal specialists based here in the Midlands, with market leading credentials and deep sector expertise, we are well placed to support our clients on deals of this calibre.”

Matt Waddell, partner and head of Deals at PwC Midlands, said:


PwC Midlands provides commercial due diligence support to PE firm Dunedin as part of a £90 million MBO transactionPrivate equity firm Dunedin announced in December 2013 its intention to back a management buyout at equipment supplier Kee Safety.

Richard Landon0121 265 [email protected]

Led by Richard Landon, the PwC Midlands Deal team provided a full-scope commercial due diligence support on the transaction, which will provide the business the resources to fuel its global expansion beyond its core European and US markets.

The provision of commercial due diligence on a stand alone basis confirms the consolidation of an all-round set of skills that can be provided by the PwC Midlands Deal team. We are now working on a cross line of service basis to consolidate the relationship and help Dunedin deliver its growth ambitions.

The Edinburgh-based investor, which bought its stake in the business from LDC, is injecting £32m into the company as it expands beyond the 50 countries in which it already operates.

Tracing its roots back to 1934 when the ‘Kee Klamp’ barrier system was designed for milking cows, Kee Safety now supplies a range of safety solutions including barrier and guardrail systems, roof edge protection, fall prevention equipment and safe access solutions.


PwC Midlands Corporate Finance team advise General Motors on the sale of Millbrook PwC Corporate Finance team are delighted to have advised US car giant General Motors (“GM”) on the sale of Millbrook Proving Ground Limited (“Millbrook”), to Rutland Partners for an undisclosed amount in October 2013. Millbrook is one of Europe’s leading test and engineering solution providers for the automotive, energy and defence markets.

Millbrook is strategically located at the heart of the UK automotive and fuels industries in Bedfordshire. The business owns a 665 acre site offering over 45 miles of on and off road test tracks with a variety of surfaces, features and terrains, as well as extensive test and validation facilities. Since the early 1970s, Millbrook has been engaged in the engineering and development of Vauxhall and other GM brands.

Millbrook has successfully developed third party (non GM) relationships in recent years which account for the majority of Millbrook’s test and engineering revenues and will accelerate this growth in the future aided in part by the expansion of facilities and by help from Rutland to invest further in and

expand its service proposition. GM will also enter into long term supply agreements with the company after the acquisition.

Sarah Taylor commented:

Sarah Taylor0121 265 [email protected]

“ We were delighted to advise GM on this transaction. GM’s strategic objective is to focus its global engineering facilities on larger regional centres and Rutland represents a strong partner to take the Millbrook business forward. Millbrook has established considerable expertise in the fields of automotive engineering, development and testing through a world class workforce and proving ground. Rutland’s acquisition enables further investment in its facilities and important third party business.”


Sale of the Leasedrive Group to HgCapital The Midlands Deal Team supported the Leasedrive Group in its sale to a European sector focussed PE investor.

Simon White0121 265 [email protected]

With offices in Berkshire and the Midlands, Leasedrive is a leading provider of bespoke fleet management, fleet funding and vehicle rental management services to private and public sector organisations throughout the UK. PwC provided support on the sale of the business to HgCapital. The business has a strong track record of customer service, has built a high quality client base and through its differing sources of revenues, is seen as a key differentiator in the vehicle leasing market.

Our Transaction Services team within the Midlands Deal Team provided the financial vendor due diligence services.


WR Refrigeration – Cool, Calm and CollectionsThe recent administration of WR Refrigeration highlights how distressed situations increasingly require that we bring together the full range of our PwC Deals services to deliver real value to clients and creditors on an accelerated basis.

Eddie Williams01509 [email protected]

With a head office in Leicester, WR Refrigeration provided the installation, repair and servicing of refrigeration and air conditioning units to the retail, distribution and wholesale sectors throughout the UK.

It was a wholly owned subsidiary of Finnish group Huure Group OY. Turnover in the year to 31 December 2012 was around £58 million with approximately 600 employees and a number of contractors. Despite its market leading position and reputation, it had required significant funding over a number of years.

We provided support to the Groups’ secured funder in respect of the business over the late summer in areas including cash flow, pensions, contingency planning and latterly through an accelerated sales process. That work, and our insight in these areas was important for maintaining value when a combination of significant further funding requests and a HMRC winding up petition meant that administration became inevitable leading to our appointment on 22 October 2013.

Rapid assessment and engagement with stakeholders was vital. The nature of operations and assets was such that it was critical for maintaining any value to be in a position to provide both assurances for ongoing services for the customers in the short term whilst providing indications around a future for their work.

Ongoing communication with the largely mobile employees and contractors was quickly put in place alongside unlocking supplies of single sourced components such as refrigerant.

We delivered this position within 48 hours whilst rapidly engaging with interested parties that we considered were in a position to complete a transaction and be acceptable to customers. This process required a commercial and constructive dialogue and lead to the completion of an innovative transaction which supported debt and contract collections only 5 business days later to Integral, a major property services business based in the South West.

This deal involved the assignment of 3 of the major contracts representing around half the business which together with subsequent transfers preserved around 300 jobs.

Joint Administrator and Director Eddie Williams commented:

“ This whole assignment is a great example of how important it is to draw on the full range of specialists from throughout PwC, to clearly set out viable options and then to implement an appropriate strategy to preserve and maximise value.

The administration was logistically amongst the most challenging projects we have undertaken in the Midlands in the last few years with a high degree of media interest. We had a very limited window of opportunity to deliver a successful outcome and I am convinced that our teamwork and approach underpinned this result.”

PwC Midlands Deal Team advises Hg Capital and management shareholders on sale of epyxPwC Midlands Corporate Finance team has advised HgCapital on the sale of epyx to Fleetcor, a US-based fuel payment processing business listed on the NYSE.



“ HgCapital’s knowledge of the sector, straightforward working style and focused approach combined with their significant support of the management team to help us deliver growth and identify exit opportunities has been a key part of the epyx success story. Additionally, as we have worked with the PwC Corporate Finance team since 2009, when HgCapital initially invested in the business, it was really valuable to have their insight and advice during the trade exit.”

“ Having advised the shareholders on the investment into the business by HgCapital and assisting in their refinancing earlier this year, PwC welcomed the opportunity to support them on this sale to Fleetcor. This deal demonstrates how businesses in the Midlands are continuing to drive real value through transactions, and clear evidence that market-leading and innovative UK businesses are of strategic value to large US corporates in the current market.”

Meriden-based epyx is a pure cloud business, providing a private electronic marketplace serving vehicle fleet operators in the UK. Epyx ’s services enable customers and suppliers in this industry to reduce costs and increase efficiency across multiple business processes, via a marketplace which connects UK’s vehicle fleet operators and 9,000+ suppliers of critical services to these fleets.

HgCapital identified epyx as a business with high levels of recurring revenue and attractive top-line growth. After tracking the opportunity for a number of years, HgCapital completed its investment in epyx in 2009.

During HgCapital’s investment period, epyx continued to deliver strong organic growth, with revenue and EBITDA CAGR of 14% and 18% respectively.

HgCapital and the management shareholders of epyx were advised on the sale by the Corporate Finance team at PwC Midlands and PwC’s technology Corporate Finance team in London.

Greg Connell, Founder & CEO of epyx, said:

Matt Waddell, partner and head of Deals at PwC Midlands commented:


WT Burdens carves out 22 depotsJanuary 2013

PwC Deal Team advised the Directors of WT Burdens, a market leader in the distribution of underground drainage products, on the sale of certain trade and assets from its core building distributions business to Wolseley plc

Welcome Break debt refinancing January 2013

PwC Midlands Deal Team, Structuring M&A Tax specialists and the Financial Decisions and Analysis team supported Welcome Break, one of Britain’s biggest motorway service operators, in the successful refinancing of their debt facilities

Sun European Capital majority stake in Paragon Print and PackagingJanuary 2013

PwC Midlands Transaction Services team provided financial, operational and tax due diligence in support of Equistone and LDC’s sale of their investment in Paragon Print and Packaging to Sun European Capital

Ricoh Arena long term future securedJanuary 2013

PwC Midlands Deal team advised the board of directors of Arena Coventry Limited, which runs the Ricoh Arena on behalf of Coventry County Council and the Alan Edward Higgs Trust charity, on its successful financial structuring

GE Aviation’s Round 3 Regional Growth Fund application April 2013

PwC Midlands Deals Team including our in-house grants specialists provided financial and grants due diligence on GE Aviation Systems successful application from the Regional Growth Fund

Sale of Node 4 to LDC backed MBO May 2013

PwC Midlands Corporate Finance team advised Node 4, a leading regional data centre, managed IT and communication specialist in the sale to an LDC backed MBO

Eve Trakway sold May 2013

PwC Transaction Services provided vendor due diligence support in the sale of Eve Trakway, a provider of temporary barriers, fencing, traffic management and security services, to Ashtead Group plc

Carlyle Group acquires ChesapeakeMay 2013

PwC Midlands Deals team provided vendor commercial, financial, tax due diligence and SPA support in relation to Irving Place Capital sale of Chesapeake, a pharmaceutical and commercial packaging manufacturerl, to the Carlyle Group

Manganese Bronze sold to GeelyFebruary 2013

PwC Midlands Deal Team successfully saved Manganese Bronze, the London Taxi Company, from closure after agreeing a deal with the Company’s former Chinese joint venture partner Geely for the sale of the business

Sale rescues Jessops January 2013

PwC Midlands Deal Team sold the brand and other assets of Jessops, a major high-street retailer of photographic equipment with a growing on-line business, to a group of buyers including Peter Jones CBE

Constantia Flexibles acquires Spear Group February 2013

PwC Midlands Transaction Services provided financial, tax due diligence and SPA advice to Constantia Flexibles, one of the world’s leading manufacturers of flexible packaging, on their acquisition of Spear Group, a leading global label manufacturer

Midlands NHSFebruary 2013

PwC Forensics and BRS completed quality governance reviews for a number of NHS Trusts in the Midlands as they progressed towards Foundation Trust status. Our work involved reviewing the Governance and Control environment, identifying gaps and recommending improvements

Better Capital acquisition of City LinkFebruary 2013

PwC Midlands Deals Team, with a blend of business recovery and transaction services experience, provided due diligence and SPA assistance to Better Capital prior to their acquisition of City Link

Sigma RedMarch 2013

PwC Midlands Transaction Services provided buy-side financial due diligence for a on bolt-on acquisition of Sigma Red. Sigma Red is a debt recovery and portfolio purchase business.

Primary Care TrustMarch 2013

PwC Forensics were able to assist the client to investigate alleged over-reporting of service performance by a third party supplier. Our work involved reviewing the reported results and the reporting environment, identifying weaknesses and recommending improvements. Eventually the case was discussed in the House of Commons Public Accounts Committee

Midlands NHS April 2013A joint team from Forensics, BRS and assurance undertook mortality reviews at a number of NHS trusts across the Midlands as part of a government inquiry. Our extensive Heath sector knowledge in the Midlands enabled us to assist them in understanding and addressing gaps or failings in their governance structures and processes around identifying and monitoring risks associated with mortality performance in accordance with timescales set by Sir Keogh


Permira invests in Dr MartensOctober 2013

PwC Midlands Deal Team supported private equity firm, Permira on its acquisition of Dr.Martens, providing a broad range of services including financial and tax due diligence, tax structuring, SPA support as well as pensions advice

Electra divests Lil-Lets October 2013

PwC Midlands Deal Team supported Electra Partners, on the sale of Lil-Lets, the feminine hygiene business, by providing corporate finance advice, and financial, taxation and pensions due diligence support during the sale to Premier Foods (Pty) Limited, a major South African based manufacturer and distributor of fast moving consumer goods

WR Refrigeration rescued from the coldOctober 2013

PwC Midlands Deal Team safeguarded a number of jobs through securing the sale of “a number” of WR’s major contracts to maintenance services firm whilst the company was in administration

HgCapital divests of epyx October 2013

PwC Midlands’ Corporate Finance team advised HgCapital on the sale of epyx , a pure cloud business, to Fleetcor, a US-based fuel payment processing business listed on the NYSE

Bilfinger acquires Europa Support Services December 2013

PwC Midlands Deal Team provided buyside financial, tax and pensions due diligence in relation to Bilfinger’s acquisition of real estate service provider Europa Support Services

Dunedin backs MBO at Kee Safety December 2013

PwC Midlands Deal team provided full-scope commercial due diligence support to Kee Safety in securing an MBO backed by Dunedin which, will enable the business to fuel its global expansion plans

LDC invest in life style clothing brand November 2013

PwC Midlands Deals Team provided financial, commercial and tax due diligence support for LDC’s minority stake investment in life style clothing brand Joules

Leasedrive Group December 2013

PwC Midlands Transaction Services provided financial vendor due diligence to the Leasedrive Group, a leading provider of bespoke fleet management, fleet funding and vehicle rental management services, on their successful sale to HgCapital, a European sector focussed PE investor

Chinese inbound investment into Midlands manufacturing July 2013

PwC Midlands Transaction Services team provided buy side financial, pension and tax due diligence to support Shandong Yongtai Chemical Group Limited’s acquisition of Covpress International Holdings, the Coventry based precision metal pressing maker

Johnson Service Group plc August 2013

PwC Midlands Deal team incorporating Corporate Finance, Transaction Services, Tax and SPA support advised on the sale of the Facilities Management division (“FM Division”) of Johnson Service Group plc (“JSG”), an AIM listed Support Services Group, to Bell Rock Bidco Limited, a company formed by Lyceum Capital LLP and a management buy in team

Stadco refinancingSeptember 2013

PwC Midlands Transaction Services and M&A Tax team provided refinancing due diligence to Telford based Stadco an international tier 1 supplier of automotive body-in-white products and services

Transaction related disputes June 2013PwC Forensics reported on a series of Completion accounts disputes and a warranty claim. Our work typically involved examination of the various clauses in the Sale and Purchase Agreements to arrive at a summary of the strengths and weaknesses of the disputed items in the completion accounts in order to obtain maximum value from the deals for our clients. For one particular example, in June, we helped our client gain a valuable insight into the target company’s financial position, ensuring an amicable and dispute free acquisition

TowerBrook acquires a controlling stake in AIM Aviation from LDCSeptember 2013

PwC Midlands Transaction Services team provided vendor financial due diligence support in relation to TowerBrook Capital Partners L.P. acquisition of a controlling stake in AIM Aviation Limited from LDC. AIM Aviation designs, engineers and manufactures cabin interiors for the world’s leading airlines

Whistle blower – investigation October 2013PwC Forensics reported on allegations of inappropriate behaviour and potential fraud at an overseas subsidiary of a large UK group. Following a discussion with the client to establish the nature and extent of whistle blower allegations we mobilised a multi-national team of investigators and Forensic technology specialists to undertake the investigation including the capture and review of some 1/2 million email and documents

General Motors dispose of Millbrook October 2013

PwC Corporate Finance team advised US car giant General Motors on the sale of Millbrook Proving Ground Limited, one of Europe’s leading test and engineering solution providers for the automotive, energy and defence markets, to Rutland Partners

Dispute litigation and e-disclosure support November 2013

PwC Forensics provided litigation and e-disclosure support to a client in the industrial manufacturing sector, collecting data from their IT systems and providing documents in PwC’s web-based document review platform allowing both the client’s lawyers and a dedicated PwC team to review and assess relevance to a dispute in a manageable way

Meet the Midlands Deal Team

Restructuring

Martin Cottle 0121 265 [email protected]

Suzanne Houghton0121 265 [email protected]

Capital markets & structuring

John Tracey0121 265 [email protected]

Investigations and Disputes

Valuations

Rebecca Clayton0121 265 [email protected] Nye

0121 265 [email protected]

SPA Advisory

M&A Tax

Nick Hatton0121 265 [email protected]

Corporate Finance

This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

© 2014 PricewaterhouseCoopers LLP. All rights reserved. In this document, “PwC” refers to the UK member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.

Design Services 28 (01/14).

Matthew Tombs01509 [email protected]

Russell Worrall0121 265 [email protected]

Transaction Services

Rob Hunt0121 265 5000 [email protected]

Karen Dukes0121 265 5000 [email protected]


Richard Parker0121 232 [email protected]

Sarah Taylor0121 265 [email protected]

Richard Landon0121 265 [email protected]

Strategy

David Morris0121 265 [email protected]

Government and Public Sector

John Morris01509 60 [email protected]

deal team times midlands - pwc uk...2 midlands deal team times january 2014 pwc midlands deal team...

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