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Shard Credit Partners completes MBO of Chameleon Technology.

Posted on 23rd December 202023rd December 2020 by shardadmin

Shard Credit Partners supports MBO of Chameleon Technology (UK) Limited (“Chameleon Technology” or the “Company”) with committed acquisition financing of £12.5 million of senior secured unitranche facility.

Shard Credit Partners has provided committed acquisition financing of £12.5 million in support of the primary management buy-out (“MBO”) of Chameleon Technology, led by CEO and co-founder Mike Woodhall together with the senior management team. The Company was established in 2010 and currently has 47 staff, mainly located at its headquarters in Harrogate, North Yorkshire. In FY2019, the Company generated revenues and EBITDA of £30.5 million and £3.4 million, respectively (11.1% EBITDA margin).

Chameleon Technology is the leading provider of in-home displays for smart meters in the UK. The accelerated drive to a decentralised, decarbonised and flexible energy system, underpinned by the ongoing smart meter roll-out, and the Government’s recently published ‘Ten Point Plan for a Green Industrial Revolution’ have created a very fertile landscape that supports and offers significant opportunities to Chameleon Technology.

The Company is well placed to deliver consumer-focused energy optimisation solutions, based on the harnessing of energy data from smart metering systems. The MBO will enable the business to accelerate its product development roadmap in step with the UK’s strategy to achieve Net Zero targets, where the decarbonisation and digitalisation of every home’s energy solution is a crucial part.

Chameleon Technology was established in 2010 by Mike Woodhall and Gary Martin in response to the UK Government’s mandated smart meter roll-out. Since inception, the Company has delivered more than six million in-home displays for installation into UK homes by the major consumer energy suppliers. Chameleon Technology is the largest and most widely distributed smart in-home display supplier in the UK, with an approximate 60% market share. Despite COVID, it has still managed to deliver more than one million devices this year. The Company has won numerous awards for innovation and growth and in 2019 achieved record sales of more than £30 million.

Mike Woodhall, co-founder and CEO said: “I am delighted to have completed this management buy-out of Chameleon Technology with the substantial financial backing of Shard Credit Partners. My co-founder, Gary Martin, with whom I have had a fantastic twelve-year working relationship, and the other exiting shareholders, can look back and be proud of what we’ve achieved together. I am grateful for their support in helping to grow the business to this enviable market position. Looking forward, we have an ambitious strategic plan in place which will answer the requirements and leverage the opportunities of the transformation of the energy system in this and other countries. The management team has been working hard to achieve the business’ goals for many years and has the experience, optimism, energy and motivation to deliver even more confident plans.

In 2020 Chameleon reached its ten-year anniversary. At this milestone, and against the backdrop of supportive government policy and the energy system transformation, it is the perfect time to put control of the company more in the hands of the management team. We will be bolder and more determined than ever and will move quickly to capitalise on new opportunities and partnerships. I am excited to be leading the Chameleon team on our journey to achieving our ambitious plans.”

Co-founder Mike Woodhall will step up from Managing Director to CEO of Chameleon Technology and will continue to focus on value growth and the strategic direction of the business. Craig Stephenson, who joined the business in early 2017, joins the Board as Chief Commercial Officer. Craig will continue to manage customer relationships and business development and to further develop new strategic partnerships. Wendi Higgins will become Company Secretary and continue as General Counsel and will also join the Chameleon Board – its first female board member. Wendi’s strategic input will become increasingly critical as the business navigates the complexities of strategic partnerships and data and cloud solutions. Founding team member and current Head of Marketing Jennifer Woodhall will become Marketing and Communications Director and will lead an increased focus on customer, partner and new business development communications in 2021.

Shard Credit Partners CEO Alastair Brown said: “Chameleon Technology has created an impressive business and enviable market position in its first ten years. The Company has a unique opportunity to capitalise on a supportive regulatory landscape and further develop its technical solutions to provide value to customers, partners and end users, as well as developing new initiatives and relationships. We are excited to be supporting Mike and the senior management team in pursuit of Chameleon Technology’s ambitious plans and to facilitate continued growth and success for the business.”

Legal advice to Shard Credit Partners was provided by Gateley Legal, led by Banking and Finance Partner Andrew Madden supported by Christian Wiltshire. Legal due diligence and corporate advice was provided by Partner Andrew Cowan, with the support of Matt Flint. Tax legal advice was provided by David Williams and Jim Hillan.

Shard Credit Partners was advised by Ryecroft Glenton Corporate Finance in Newcastle, led by Nick Johnson and supported by Alex Simpson. Financial and tax due diligence was provided by Ryecroft Glenton, led by Grahame Maughan, Andrew Cameron and Jon Routledge. Tax structuring advice was provided by Ryecroft Glenton tax Partner Simon Whiteside.

This transaction is the eighth consecutive buy-out transaction financed by Shard Credit Partners in the North of the UK in the past two years, making the alternative investment firm one of the most active institutional investors in the Northern UK regions currently. It is also the third investment completed by Shard Credit Partners during December 2020.

Shard Credit Partners’ strategy is to become a leading provider of capital to entrepreneur and management-owned companies focused on achieving transformational growth and expansion for high growth SMEs in the UK regions. In the past two years, Shard Credit Partners has invested more than £100 million in supporting regional Management Buy-Out transactions and M&A buy-and-build acquisition strategies, as well as growth capital expenditure financing.

About Shard Credit Partners:

Shard Credit Partners is an alternative investment fund manager focused on private credit strategies in the UK lower mid-market. Its funds seek to generate superior risk-adjusted returns from conservatively structured senior secured credit investments at low leverage, benefiting from robust documentation and a full suite of financial and non-financial covenants. Shard Credit Partners is currently investing from its debut direct lending fund Shard Credit Partners Fund I, which held a first close in October 2017 at £90 million. Shard Credit Partners plans to hold a first close on its second UK lower mid-market direct lending fund during the first half of 2021.

Shard Credit Partners invests in solid small to medium sized businesses with strong management teams, supporting them by providing transformative growth capital and event driven financing in support of innovation, growth and expansion. The fund invests in businesses across all sectors and throughout the UK. The firm has a strong ESG focus; in particular, it is a strong supporter of female entrepreneurs and firms with meaningful female leadership and senior management.

Recent investments include the innovative double MBO of BW Legal and PRAC Financial in Leeds, which was named by Insider Media as their Deal of the Month for February 2019. In the same month the fund also backed the primary MBO of GadCap Technical Solutions Ltd in Newcastle. In September 2019, Shard Credit Partners completed the MBO of Alexander Technologies Europe Limited in Peterlee, County Durham named by Insider Media to the short list for North East Private Equity/Venture Capital Deal of the Year 2020. In March 2020, Shard Credit Partners backed the MBO of Jackson Lees Group in Merseyside by its senior management team. In December 2020, Shard Credit Partners completed the MBI of Scottish port services company JST Services (Scotland) Limited, its first investment in Scotland and the MBO of eQuality Solutions Ltd in Hebburn, Tyne and Wear.

‘Shard Credit Partners completes MBO of eQuality Solutions Ltd in Hebburn, Tyne and Wear’

Posted on 21st December 202021st December 2020 by shardadmin

Shard Credit Partners announces signing and completion of a £12.0 million senior secured unitranche financing in support of the MBO of market-leading assistive technology equipment, training and software provider eQuality Solutions Ltd (“eQS” or the “Group”), which completed on 19^th December 2020.

Shard Credit Partners has provided committed acquisition financing of £12.0 million in support of a management buy-out (“MBO”) of eQS, led by current CEO Andy Gough and the incumbent senior management team. The MBO team will undertake a buy-and-build acquisition strategy in the UK assistive educational technology and training sector, with eQS providing a platform for growth.

North-east headquartered eQS was established in 2006 by Chris Quickfall to improve the quality of assistive technology equipment provision for students eligible for the Disabled Students Allowance (“DSA”), based upon his own experience as a dyslexic DSA student. The Group is now one of the largest assistive technology and training providers in the UK with a 65% share of the UK DSA assistive technology e-learning sector.

From its HQ in Hebburn, the business employs 40 full-time staff with 80 consultants operating nationwide, providing assistive technology equipment, training and its own software solutions that help to remove barriers to learning for students with cognitive disabilities. The business has experienced rapid growth over the last three years, generating LTM October 2020 revenues and Adjusted EBITDA of £6.4 million and £1.6 million, respectively (24.3% Adjusted EBITDA margin).

Commenting on the MBO, CEO Andy Gough said: “eQS is the number one provider in this specialist and vitally important sector. We are confident that, from the platform already established, we can grow the business across the UK and take advantage of the many new opportunities we see ahead.”

Gough, who has over 15 years of tech experience, has successfully managed eQS for the past 3 years alongside CFO, Michael Hall, who was previously FD of Maxim Facilities Management. They are joined by Non-Executive Chair Neil Stephenson, who is best known as the former CEO of North East-based internet provider Onyx Group, with the founder and serial entrepreneur Chris Quickfall retaining a minority stake in eQS and joining the board with a focus on strategy.

Gough’s vision for the business is to develop eQS into a significantly larger educational technology business, with a focus on inclusivity and mental wellbeing, something significant to his personal life too, he said: “This is an area close to my heart as I have two children with hidden disabilities. The investment we have secured from Shard Credit Partners will allow the business to continue with its ambitious growth plans, providing specialist technology and services designed to help people with cognitive disabilities, which will also result in significant job creation.”

Shard Credit Partners CEO Alastair Brown said: “eQS is an organisation on a positive growth trajectory driven by an experienced and talented management team. We are delighted to have facilitated the change in ownership under the MBO and to be providing substantial follow-on funding to support the planned buy and build acquisition strategy. Andy and his team have a clear strategic vision to grow eQS into a scaled nationwide operator in the assistive educational technology, software and training sector. The specialist services offered by eQS are vitally important to increasing social mobility and engagement with higher education for its customers, who live with a broad range of cognitive disabilities and physical conditions. eQS is making a positive difference in levelling the playing field for a significant segment of society and we are getting behind that mission with a meaningful eight figure investment.”

The investment by Shard Credit Partners will enable eQS to expand its core offering by providing funding for a series of bolt-on acquisitions, as the business provides a platform for consolidation in the UK’s highly fragmented assistive educational technology sector.

Legal advice to Shard Credit Partners was provided by Gateley Legal, led by Banking and Finance Partner Andrew Madden and ably supported by Alison Davidson-Cox, with legal due diligence and corporate advice provided by Partner Gareth John, with the support of Lauren Hamer and Bahez Talabani.

Financial and tax due diligence was provided by RMT Accountants and Business Advisers Limited in Newcastle, led by Head of Corporate Finance Michael Cantwell.

This transaction is the seventh consecutive buy-out transaction financed by Shard Credit Partners in the North of the UK in the past two years, making the alternative investment firm one of the most active institutional investors in the Northern UK regions currently.

Shard Credit Partners’ strategy is to become a leading provider of capital to entrepreneur and management-owned companies focused on achieving transformational growth and expansion for high growth SMEs in the UK regions. In the past two years, Shard Credit Partners has invested more than £90 million in supporting regional Management Buy-Out transactions and M&A buy-and-build acquisition strategies, as well as growth capital expenditure financing.

Notes to editors:

Higher education students and adults in the workplace can access eQS’ specialist services through the respective Government funds known as Disabled Students Allowance fund and the Access to Work fund. Additionally, universities and organisations can also privately invest in this specialist support.

Shard Credit Partners completes its first buy-out investment in Scotland.

Posted on 8th December 202020th December 2021 by shardadmin

Shard Credit Partners announces its first investment in Scotland with signing and completion of a £12.0 million senior secured unitranche financing in support of a MBI acquisition of market-leading port handling and logistics company JST Services (Scotland) Ltd (“JST Services” or the “Company”) which completed on 6^th December 2020.

Shard Credit Partners has provided acquisition financing of £12.0 million in support of a management buy-in (“MBI”) acquisition of JST Services, led by new CEO and port sector veteran Richard Jennings and Independent Port Capital Management Ltd (“IPC”), a Jersey-based port sector investor. The MBI team in conjunction with Shard Credit Partners will undertake a buy-and-build acquisition strategy in the UK port logistics sector with JST Services at its core.

JST Services was formed in 1993 by John Scott and is the market-leader in providing flexible port-handling services throughout the UK and Ireland via its modern fleet of specialist mobile cranes, floating piers, road haulage vehicles, and maritime shipping services. JST Services is headquartered in Ayr in South West Scotland. Under John Scott’s ownership, JST Services has demonstrated an impressive track record of bringing design innovation and bespoke engineering solutions to the dry bulk and break-bulk cargo and materials handling sectors over several decades since inception. The Company benefits from having a unique portfolio of patents and designs for its extensive range of specialist materials handling equipment, which is actively deployed on a daily basis throughout many of the UK’s ports.

The investment by Shard Credit Partners will enable JST Services to expand its core offering by providing funding for a series of bolt-on acquisitions, as the business provides a platform for consolidation in the UK’s highly fragmented port services industry.

Richard Jennings, the new CEO of JST Services said: “John Scott and the JST Services team have built a well-respected and highly successful business, which provides a solid platform for further strategic growth. With the support of Shard Credit Partners, we are keen to scale the company by expanding our presence in the port services sector organically and through targeted M&A activity to enable more consolidation across the industry, offering greater confidence and continuity to our customers.”

Alastair Brown, CEO of Shard Credit Partners, commented: “This is an excellent opportunity for us to work closely with a dynamic new management team who can build on the substantial achievements of this innovative business. We are confident that JST Services will be successful in overcoming the fragmentation of the UK port services sector through an M&A strategy that will lead to the creation of a network of operations that will give its customers a consistent and reliable single-source service across the UK and in time, further afield.”

Providing corporate finance advice to Shard Credit Partners and the MBI team was Newcastle-based corporate finance boutique RG Corporate Finance (“RGCF”), led by Partner and Head of Corporate Finance, Carl Swansbury, supported by Corporate Finance Senior Manager, Rhiannon Nightingale. Business and transactional tax advice was provided by RG’s Business Tax Partner Simon Whiteside and Director, Simon Hopwood. Financial and tax due diligence was conducted by RG’s Grahame Maughan, Andrew Cameron and Jon Routledge.

Legal advice to Shard Credit Partners was provided by Gateley Legal, led by Partners Andrew Madden and Andrew Cowan.

Rhiannon Nightingale, Corporate Finance Senior Manager at RGCF said: “This is a significant and technical transaction, bringing together a new management team and an experienced third-party funding provider that will ensure that JST Services has the resources and expertise required to embark upon the next stage of its scale-up journey. As the business identifies potential acquisition targets and continues with its ongoing organic growth, it has the potential to significantly grow its market share.”

JST Services was supported legally by John Fulton and Andrew Fleetwood, Partners at Gilson Gray LLP, with financial and tax advice from William Duncan & Co, led by Managing Partner Robert Fergusson.

This transaction represents the first buy-out of a Scottish business financed by Shard Credit Partners. It is also the sixth consecutive buy-out transaction financed by Shard Credit Partners in the North of England and Scotland in the past two years, making Shard Credit Partners one of the most active investors in the Northern English regions and Scotland currently. It is currently working on further mandates in the North of England which it expects to complete by year end.

Shard Credit Partners’ strategy is to become a leading provider of capital to entrepreneur and management-owned companies focused on achieving transformational growth and expansion in the UK regions. In the past two years, Shard Credit Partners has invested more than £80 million in supporting regional Management Buy-Out transactions and M&A buy-and-build acquisition strategies, as well as growth capital expenditure financing.

About Shard Credit Partners:

Contact details:

Newgate Communications

Tel: Elisabeth Cowell / Robin Tozer / Isabelle Smurfit

Email: shardcapital@newgatecomms.com

Shard Credit Partners

Investor relations: IR@shardcreditpartners.com

Business: info@shardcreditpartners.com

Website: www.shardcreditpartners.com

Shard Credit Partners provides financing to SKS Business Services to acquire Bailey Group

Posted on 1st October 2020 by shardadmin

Shard Credit Partners has surpassed £40 million of investment in the North East of England

Shard Credit Partners has provided acquisition financing to SKS Business Services Limited (“SKS”) to support its acquisition of the tax, accounting, audit and outsourcing services of Bailey Group.

Headquartered in Peterlee, County Durham, Bailey Group is an award-winning chartered accountancy and tax advisory practice. The Group operates ten offices located across the North East of England employing seventy people. Bailey Group provides high-quality accounting services to more than three thousand SME customers.

The acquisition of Bailey Group will provide SKS with a strong presence and established customer base in the North East of England. The addition of an operation in the North East means SKS now has a presence in five out of the eight UK regions, including the East of England, the South East of England, London, the North West of England. SKS has rapidly become one of the UK’s leading SME-focused accounting services and tax advisory firms through its network of offices across the UK with client numbers growing to nearly twelve thousand, up from three thousand in 2018.

As well as increased geographical reach, SKS’s buy and build strategy has delivered strong revenue growth from £5.6 million in June 2018, to over £16.8 million (as at 21 September 2020, pro forma for the Bailey acquisition). With the addition of Bailey, SKS’s consolidated group EBITDA has increased from £1.2 million to £4.8 million in the same period.

The acquisition funding was provided under a committed facility of £20 million provided by Shard Credit Partners. The facility was recently increased from £10 million in August 2020. In recent years, SKS has successfully acquired eleven businesses using funding from Shard Credit Partners. This transaction is the second buy-out of a Durham-based business financed by Shard Credit Partners in the past year, and the fifth consecutive buyout transaction completed in the North of England in the past two years. Shard Credit Partners is now one of the most active investors in the North and specifically the North-east. Shard Credit Partners is working on further mandates in the region which are expected to complete in the coming months.

Shard Credit Partners’ strategy is to become a leading provider of capital to companies focused on achieving transformational growth and expansion in the North of England. In the past 18 months, Shard Credit Partners has invested more than £50 million across the whole region. Investments in the region include Management Buy-Out and M&A Buy-and-Build transactions, as well as growth capital expenditure financing.

Shard Credit Partners CEO, Alastair Brown, said: “SKS’s acquisition of Bailey Group in Peterlee, County Durham, represents a landmark in its nationwide expansion strategy. We began our relationship with SKS nearly three years ago and this is its largest acquisition so far”.

Sanjay Swarup, Managing Director of SKS, said: “Our merger with Bailey Group merger is a huge leap forward towards attaining our goal of becoming a national firm. SKS’s infrastructure enhances Bailey’s capacity, allowing its accountants to spend more time advising clients through these extra-ordinary times we find ourselves in.

“I find Chris Bailey to be a no-nonsense person who is equally committed to providing business advisory, value for money accounting and tax services to his clients. SKS is all about helping firms such as Bailey Group achieve this quickly and successfully. We are also speaking to other firms in the North East and across the UK who are interested in merging with SKS and expect to unveil further accountancy firms joining SKS Group in the near future”.

Christopher Bailey, Director of the new SKS Bailey Group, said: “Bailey Group is delighted to merge with SKS Business Services, it is a nationwide and prestigious group that will help us provide the highest level of client service. I look forward to continuing my role within the new SKS Bailey Group. Merging with SKS provides us with the opportunity to offer a service that is centred on advisory, backed up with a range of more sophisticated services. This is important to us, particularly in the current climate, as so many local businesses are facing financial problems and are looking for practical help and guidance from their accountants to plan for an uncertain future. We look forward to continue growing across the North East as part of the SKS group.”

SKS was advised by Jeremy Over at Moore Barlow and financial due diligence was conducted by David Preston at Mazars. Andrew Madden at Gateley Legal acted for Shard Credit Partners in relation to the senior secured unitranche facilities.

Contact details:

Newgate Communications

Elisabeth Cowell / Isabelle Smurfit

Email: shardcapital@newgatecomms.com

Shard Credit Partners

Investor relations: IR@shardcreditpartners.com

Business: info@shardcreditpartners.com

Website: www.shardcreditpartners.com

About Shard Credit Partners:

Shard Credit Partners is an alternative investment fund manager focused on private credit strategies in the UK lower mid-market. Its funds seek to generate superior risk-adjusted returns from conservatively structured senior secured credit investments at low leverage, benefiting from robust documentation and full covenants. Shard Credit Partners is currently investing from its debut direct lending fund Shard Credit Partners Fund I, which held a first close in October 2017 at £90 million. Shard Credit Partners plans to hold a first close on its second UK lower mid-market direct lending fund during the first quarter of 2021.

Recent investments include the innovative double MBO of BW Legal and PRAC Financial in Leeds, which was named by Insider Media as their Deal of the Month for February 2019. In the same month the fund also backed the primary MBO of GadCap Technical Solutions Ltd in Newcastle. In September 2019, Shard Credit Partners completed the MBO of Alexander Technologies Europe Limited in Peterlee, County Durham. In March 2020, Shard Credit Partners backed the MBO of Jackson Lees Group in Merseyside by its senior management team. The fund is currently working on a number of live mandates around the UK for completion in the fourth quarter of 2020.

£12.0 million senior secured unitranche loan facility in support of the MBO of award-winning law firm

Posted on 16th March 2020 by shardadmin

Shard Credit Partners announces the signing and completion of a £12.0 million senior secured unitranche loan facility in support of the management buy-out by MAPD Ventures of award-winning North West law firm Jackson Lees Group Ltd and to finance a nationwide buy-and-build acquisition strategy. The MBO of JLG, which completed on 11^th March 2020, was led by its incumbent senior management team comprising CEO Brian Cullen and COO Joanna Kingston-Davies. As part of its buy-and-build strategy, JLG will progress with its near-term acquisition pipeline of three legal services businesses, primarily based in the North West of England.

MAPD (Making a Positive Difference) is the single core value of the Jackson Lees Group and Cullen and Kingston-Davies felt it only natural that they would incorporate this ethos and vision into the name of the new parent company. This ethos gels well with Shard Credit Partners’ stated objective to encourage and promote diversity in the ownership and board structures of its investee companies, including supporting female entrepreneurs.

JLG was formed in 2017 following the 2016 acquisition of Lees by Jackson Canter. It is comprised of two divisions, Jackson Lees and Broudie Jackson Canter. JLG is a leading legal services firm in the North West of England, providing individuals and commercial clients with high-quality services across clinical negligence, residential property, court of protection, wills, trust and probate and a range of other sectors. JLG is renowned for its work in supporting families at the Hillsborough Inquest and Birmingham Pub Bombing Inquest and is currently working with families on the Manchester Arena Bombing Inquiry.

JLG is highly focused on environmental, social and governance (ESG) matters, which Shard Credit Partners is proud to support. The Company is proud to offer services that make a positive difference to society and has a national reputation for its Access to Justice work which ensures the most vulnerable have access to appropriate legal advice. Furthermore, JLG established the Jackson Lees Foundation in 2015 with the aim of supporting disadvantaged groups within the community, under four pillars: justice, social, education and medical care. JLG has received recognition via multiple award wins including the ‘’Work in the Community’’ award at the Liverpool Law Society Awards 2017.

Brian Cullen, CEO of JLG, said: “the MBO begins an exciting new chapter in the growth of our business and now allows us to accelerate finding great businesses to join the Group. The relationship with Shard is founded on a mutual view of what a ‘Great’ business should look like, with a strong view of cultural alignment, putting people at the forefront of what we do both internally and externally, and we are delighted to have their backing.”

Joanna Kingston-Davies, COO of JLG, noted: “our strategy is predicated upon taking away the headache of “back office” for law firm owners to free up their time to focus on localised growth and development. By providing strong operating platforms and infrastructure with defined career structures and leadership, we will enable traditional law firms to deal with succession issues and to focus on what they do best.”

Alastair Brown, CEO of Shard Credit Partners, commented: “we are delighted to have been able to support Brian and Joanna in this MBO transaction. This represents the first investment from our current fund in the North-West UK region, which will form the nucleus of an ambitious buy-and-build acquisition strategy to create a more significant legal services group nationwide.”

Financial Due Diligence was provided by Ros Jones and Rebecca Smith from Dow Schofield Watts Transaction Services.

The Vendors and senior management team leading the MBO were advised by James Curtis from Dow Schofield Watts Corporate Finance, Brian McCann of Shareholder Strategies and O’Connors Legal Services Limited.

Legal advice to Shard Credit Partners was provided by Gateley led by Partners Andrew Madden and Andrew Cowan, supported by Alison Davidson-Cox, Christian Wiltshire and Matthew Smith.

This transaction marks Shard Credit Partners’ fourth consecutive MBO financing in the North of England in the last 13 months and the third consecutive MBO financing which includes a female entrepreneur in the incumbent senior management buy-out team. In 2019, the Fund supported the £13.5 million MBO of Leeds-based BW Legal by its co-founder Rachael Withers, the £5.7 million MBO of GadCap Technical Solutions in Tyne & Wear by its senior management team and the £9.2 million MBO of Durham-based Alexander Technologies Europe Limited by its incumbent senior management team.

ENDS

£9.2 million senior secured unitranche loan facility in support of MBO of Alexander Technologies Europe Limited

Posted on 9th September 20199th September 2019 by shardadmin

Shard Credit Partners announces £9.2 million senior secured unitranche loan facility in support of management buy-out (“MBO”) of Alexander Technologies Europe Limited (“ATEL” or “Alexander”).

Shard Credit Partners announces the MBO of ATEL by its senior management team led by President and CEO Michael Shirley, from US-based private equity group Woodside Capital Partners, for an undisclosed value. The acquisition, which completed on September 5^th, was part-funded under a £9.2 million senior secured unitranche facility (the “Facility”) provided by Shard Credit Partners Fund I (“the Fund”).

ATEL, founded more than 40 years ago, is a portable battery pack manufacturer headquartered in Peterlee, County Durham. The Company works closely with its blue-chip OEM customers in the design and manufacture of customised rechargeable battery packs and charging equipment that are designed for integration with health and safety devices, personal protection products, medical devices, and highly engineered portable powered products. ATEL sells its products both in the UK and internationally, with a focus in North America and Europe.

Michael Shirley, CEO of ATEL said, “The team is very excited to begin the next chapter in the history of ATEL. This partnership will allow Alexander to extend its strong, double-digit growth achieved over the last three years and combine its recently awarded ISO 13485 quality certification with the new development plans in the North East UK. We are fortunate to have a highly specialised team with a proven track record and this combination helps to solidify the Company’s future as a top designer and manufacturer of portable power”.

Alastair Brown, CEO of Shard Credit Partners said, “Alexander Technologies Europe Ltd is an example of the high quality, technology-led companies located in the Northern Powerhouse region that, through our investment and experience, will enable us to build on their previous achievements to deliver greater growth and financial success. It has established a strong position in its industry, which is testament to the expertise and experience of its workforce. We are confident, by working in close partnership with CEO Michael Shirley and the management team, that the business can achieve increased market share through the enhanced production of its innovative technologies.”

In addition to providing initial acquisition funding for the MBO, the Facility also includes a £1.0 million backstop guarantee and funding line in support of a significant development capital investment programme. This will facilitate the move into a new, state of the art manufacturing and warehouse premises and the creation of a meaningful number of new jobs at ATEL’s main site in Peterlee. The planning and investment in plant and machinery is currently underway and will substantially increase manufacturing capacity.

Shard Credit Partners was advised by a team from Ryecroft Glenton (“RG”) Corporate Finance led by Head of Corporate Finance Carl Swansbury, supported by Senior Manager Alex Simpson. Tax advice was provided by RG’s Simon Whiteside, Simon Hopwood and John Routledge with Financial Due Diligence delivered by RG’s Grahame Maughan and Andrew Cameron.

Legal advice to Shard Credit Partners was provided by Alison Davidson-Cox and Sophie Denton from Gateley, led by Senior Banking Partner Andrew Madden.

Woodside Capital Partners was advised by US-based investment banking firm SSG Capital Advisors and European based group Saxenhammer & Co. UK Legal advice was provided by Ward Hadaway and Muckle LLP.

Carl Swansbury, Head of Corporate Finance at RGCF, said: “Shard Credit Partners’ continued investment in the North East and Yorkshire demonstrates its confidence in the regions and its foresight to identify and engage with companies that will benefit, not only from private credit investment, but also from its experience and expertise.

“This significant transaction will support ATEL in achieving its next stage of growth, but also provide a boost to the North East economy through continued investment in technology and job creation.”

This transaction marks the third consecutive MBO in the North of England this year in which Shard Credit Partners has acted as the exclusive financing provider to an incumbent management team. The UK-focused direct lending fund earlier this year supported both the £13.5 million MBO of Leeds-based BW Legal by its co-founder Rachael Withers and the £5.7 million MBO of GadCap Technical Solutions, based in Washington, Tyne & Wear, by its senior management team. Both transactions completed simultaneously on February 8^th, 2019.

ENDS

Shard Credit Partners backs simultaneous management buy-outs of BW Legal Services Ltd and PRAC Financial Ltd

Posted on 12th February 201912th February 2019 by shardadmin

Shard Credit Partners backs the simultaneous management buy-outs of BW Legal Services Limited and PRAC Financial Limited in the North East by co-founder and COO Rachael Withers.

Shard Credit Partners announces the completion of the management buy-outs (“MBO’s”) of both BW Legal Services Limited (“BWL”) and PRAC Financial Limited (“PRAC”, together, the “Group”) by Rachael Withers, COO and co-founder of both businesses. The two side-by-side MBOs completed and funded simultaneously on February 8^th, 2019. Shard Credit Partners acted as exclusive financing provider, underwriting £13.5 million of committed senior secured unitranche facilities to complete the two deals. The innovative financing structure has enabled the simultaneous refinancing, recapitalisation and shareholder re-organisation of the Group, whilst also providing committed acquisition firepower to grow the businesses.

BWL was founded in 2009 by Rachael Withers and Sean Barton and is the UK’s largest independent law firm specialising in debt recovery services and is dual regulated by both the Financial Conduct Authority (“FCA”) and the Solicitor’s Regulatory Authority (“SRA”). The Group is based in Leeds, West Yorkshire and employs around 250 staff. BWL acts as a one-stop-shop for high volume debt collection and litigation, focussed on delivering market-leading recovery solutions in an ethical and fair manner to clients in both the highly regulated consumer debt sector as well as the traditional commercial debt sector. Clients range from established sectors such as debt purchasers, financial services, private parking, commercial and energy. PRAC is an FCA regulated debt purchase vehicle that acquires portfolios of non-performing consumer and commercial debt.

Withers is one of the first ever non-lawyer owners of a debt recovery and litigation law firm. She has been responsible for running some of the largest collection and litigation projects in both the commercial and consumer credit environments, including one of largest insolvency collect-outs in British corporate history for the administrators on Entertainment UK, a group company of Woolworth Group that had syndicated lenders funding aged debtors with a value in excess of £360 million at the time of administration.

Andrew Madden at Gateley plc (“Gateley”) acted as legal adviser to Shard Credit Partners. Andrew Cowan at Gateley led the legal due diligence review. John Connor at Womble Bond Dickinson (“WBD”) acted on behalf of both BWL and PRAC. Grant Thornton (“GT”) was appointed to conduct financial due diligence for the Lender. BWL and PRAC were advised by Andy Haigh at BHP Corporate Finance (“BHP”), a corporate finance advisory business based in Leeds and Sheffield.

Shard Credit Partners has now completed three investments from its inaugural fund, with its second and third investments both completing on the same day (February 8^th, 2019). In addition to the simultaneous MBOs of both BWL and PRAC in Leeds, Shard Credit Partners also completed and funded the MBO of GadCap by its senior management team in Newcastle on February 8^th, 2019.

Greg Lomas, CIO of Shard Credit Partners commented, ‘completing two, let alone three MBOs in one day is a first for us, we very much look forward to completing our fourth investment in the coming weeks’. Following these investments, Shard Credit Partners Fund I will be around one-third deployed.

Typically, Shard Credit Partners aims to invest as the sole finance provider through senior secured unitranche loan structures, in amounts of between £5-15 million per borrower. Alastair Brown commented, ‘the overall strategy is to invest where we can provide transformative growth capital to unlock a faster rate of growth than would otherwise be achievable with more traditional forms of lending. The Fund’s first investment into SKS Business Services Ltd in May 2017 has already resulted in a doubling in customer numbers and EBITDA for that business in less than one year’.

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Shard Credit Partners backs management buy-out of GadCap Technical Solutions Ltd

Posted on 8th February 201912th February 2019 by shardadmin

Shard Credit Partners backs the management buy-out of GadCap Technical Solutions Ltd in the North East by its senior management team

Shard Credit Partners announces the acquisition by way of a primary management buy-out (“MBO”) of the business and assets of the power generation and aerospace solutions (“PGAS”) division of a multinational engineering conglomerate in the North East of England. The new business will be called GadCap Technical Solutions Limited (“GadCap”) and is based in Washington, Tyne and Wear. The MBO completed and funded on February 8^th, 2019.

The MBO is being led by Michael Baker and Paul Seccombe, a pair of experienced engineers who have worked together in the business being acquired for a combined total of more than thirty years, since 2002. The team will implement a programme of organic growth to further develop the GadCap business internationally, with a particular focus on growing their share of the aerospace and energy and power engineering markets in the Middle East, China and Asia.

GadCap designs and manufactures market-leading bespoke engineered products for the power generation and aerospace industries. The PGAS division is the only business in the world producing a consumable steel-based, mineral product utilised in Advanced Gas Cooled Nuclear power stations with a long-term contract to supply the UK nuclear fuel industry.

GadCap is also a market leader in the design and production of bespoke tip clearance sensors through its CapaciSense product line, which are used in the measurement of operational gas-powered turbines during product development to increase energy efficiency and safety.

Funding for the deal has been provided exclusively by London-based Shard Credit Partners. Alastair Brown, CEO of Shard Credit Partners commented, ‘We are delighted to have been selected as financing partner to back this high quality MBO. This will be our first investment in the North East region and we look forward to working with the MBO team to help them execute their organic growth strategy for the business over the coming years.’

Andrew Madden and Kerry Gibbons at Gateley plc acted as legal advisers to Shard Credit Partners. Andrew Cowan at Gateley led the legal due diligence review.

Michael Baker said: “Paul and I are very proud to establish GadCap Technical Solutions Ltd, building on the solid foundations of the previous organisation. We have created a strong niche in key markets through the creation of innovative engineered-solutions, which we have ambitions to expand in our existing markets and new geographies.”

Paul Seccombe said: “Working with Shard Credit Partners we are confident in our ability to grow the business and maximise on our position at the heart of the North East and its engineering pedigree. We have a very talented team of engineers and manufacturing personnel, producing advanced and bespoke products, which we aim to expand as we develop the business further.”

The corporate finance adviser to the MBO team was Ryecroft Glenton (“RG”) in Newcastle. David Nixon, Corporate Finance Manager at RG commented, ‘having led the PGAS division for a number of years, Paul and Michael were ideally-placed to take on the operation from its owners through an MBO. They have been instrumental in the success of the operation to date and had the autonomy to develop and grow the business, which they have done very successfully’.

Shard Credit Partners has now completed three investments from its inaugural fund, with its second and third investments both completing on the same day (February 8^th, 2019). In addition to the MBO of GadCap in Newcastle, Shard Credit Partners also completed and funded the MBO of BW Legal Services Ltd in Leeds on February 8^th, 2019.

Alastair Brown, CEO of Shard Credit Partners commented, ‘completing two MBOs in one day is a first for us, we very much look forward to completing our next investment in the next several weeks’. Following these investments, Shard Credit Partners Fund I will be around one-third deployed.

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Further four SKS Business Services acquisitions announced

Posted on 17th September 20183rd October 2018 by shardadmin

Shard Credit Partners announces the acquisition of four chartered accountancy and insolvency practices by its investee company SKS Business Services Ltd (“SKS” or “the Company”). The acquisitions were funded under a £10 million senior secured unitranche facility provided by Shard Credit Partners Fund I (“the Fund”) in May 2018. SKS is an award-winning firm of chartered accountants providing accounting, bookkeeping, tax, payroll and outsourced finance function services to a predominantly SME customer base located throughout the South East of England.

Since the date of the initial financing in May, SKS has been able to rapidly accelerate its acquisition growth strategy, as it seeks to become a top twenty UK accounting firm and grow nationwide. SKS, which is pursuing a buy-and-build strategy, has completed twelve acquisitions since November 2013. As a result of the four recent acquisitions, SKS has increased its customer base by nearly 50% during the past three months from around 3,100 to 4,500, which will generate a more than 70% increase in annual fee income.

SKS operates a vertically integrated offshore operating model with 60 staff in the UK and 155 professional support staff located across four offices in North-West India. SKS provides its customers with high quality outsourced services at competitive prices, enabling them to compete on a level footing with larger corporates which have outsourced such functions for more than a decade.

The largest of the four recent acquisitions, Ramon Lee, will serve as SKS’ new business hub in London City. Ramon Lee provides accounting and business planning services to more than one thousand small businesses based in and around Old Street. Wall & Co, based in Ash, Hampshire, is a bolt-on acquisition to SKS’ existing Hampshire-based business, Gilroy & Brookes. The acquisition adds nearly one hundred mainly small business clients, further strengthening SKS’ position in the Hampshire region. Place Flight, which provides accounting services to more than two hundred SMEs in Tunbridge Wells, was acquired by Ward Mackenzie, SKS’ Kent-based business.

MLM Solutions, an insolvency practice based in Edinburgh, was purchased by the Company’s insolvency division, Benedict Mackenzie. The combined entities will now be able to provide insolvency services throughout the UK.

All four acquisitions will enable the previous owners to successfully exit their businesses over a period of time, whilst realising the value of their enterprise and ensuring that their valued customers will continue to benefit from high quality professional accounting services under the umbrella of a larger group with strong nationwide growth ambitions.

Shard Credit Partners CEO, Alastair Brown, said, “SKS is delivering on its transformative growth strategy, rapidly scaling its business through acquisitions to build a nationwide accounting business capable of challenging the accounting sector incumbents with its innovative offshore outsourcing model. We are delighted to be supporting it”.

Sanjay Swarup, Managing Director of SKS, said “I’m very pleased with our progress as we rapidly expand our presence nationwide; we now have offices in London, Surrey, Kent, Sussex, Hampshire, Berkshire and Scotland. These acquisitions are the first in a long pipeline of opportunities that we are pursuing to further strengthen our portfolio. With this in mind, we are keen to hear from accounting and insolvency practice owners who are looking to exit, or part exit their practice and ensure that a positive legacy is maintained.”

Shard Credit Partners is a UK lower mid-market-focused direct lending fund established to provide flexible long-term growth capital to UK SMEs. It is now in advanced negotiations with a number of other potential investment opportunities, which offer similar exciting growth potential to SKS. Typically, Shard Credit Partners aims to provide non-amortising unitranche loans of between £5-15 million per borrower, with maturities of three to seven years.

The UK lower mid-market, which includes circa 33,500 SMEs with between 50-250 employees, remains under-developed in terms of alternative, non-bank financing, despite offering a high volume of high quality lending opportunities. Current and previous governments have sought to bolster support for the sector with initiatives such as the British Business Bank, founded in 2014 by SKS’s own MP, Liberal Democrat leader, Sir Vince Cable. British Business Investments, a commercial subsidiary of the British Business Bank, supported Shard Credit Partners with an investment at the time of its fund raise in late 2017.

For more information, please contact Shard Credit Partners +44 207 186 9970 / info@shardcreditpartners.com

UK lower mid-market direct lending fund first close at £90 million

Posted on 11th December 20173rd October 2018 by shardadmin

Shard Credit Partners announces the first close of its inaugural UK direct lending fund with £90 million in commitments from both UK and European institutional investors. The fund will provide innovatively structured senior and junior loan capital to a diverse range of SMEs (including private equity-backed businesses) operating in the UK lower mid-market (defined as companies with an enterprise value below £50 million and having between 50 and 249 full-time employees).

Shard Credit Partners will primarily target borrowers with annual revenues of below £100 million that are finding it increasingly difficult to source long-term financing from traditional bank sources. The fund will provide flexible loan capital in support of business growth and expansion, or for event driven M&A activity, such as a transformative acquisition or a management buy-out or other change of control. The fund will lend to businesses located throughout the UK and operating across a diverse range of industries. Typical loan sizes will range between £5-15 million per borrower, with maturities of three to seven years.

Whilst the UK mid-market is becoming increasingly competitive, with more than forty direct lending funds seeking to deploy billions of pounds equivalent in committed capital, the UK lower mid-market remains significantly under-developed in terms of alternative, non-bank financing. Only a small handful of direct lending funds exist which specifically focus on the £5-15 million direct lending segment in the UK, the main addressable market for the new Shard Credit Partners fund. Conversely, the UK lower mid-market offers a high volume of good quality lending opportunities, with more than 200 buy-outs being completed each year by more than one hundred private equity and venture capital firms. There are approximately 33,500 SMEs in the UK lower mid-market, representing a large and sustainable market opportunity for Shard Credit Partners’ direct lending fund.

Tim Hames, the Director General of the British Private Equity and Venture Capital Association, said “The arrival of a new and innovative fund in this space should be excellent news for ambitious UK SMEs.”

Shard Credit Partners was founded by a team of experienced leveraged finance market practitioners. In total, the founding partners have a combined 80 years of experience in leveraged loan sourcing, origination and structuring and asset management, having completed in excess of £70 billion equivalent of leveraged loan transactions during their careers to date.

Alastair Brown, Chief Executive, commented, “We are delighted to have held a first close and greatly appreciate the support of our investors, which includes significant commitments from each of British Business Investments (the commercial arm of the British Business Bank) and the European Investment Fund. We can now focus on providing much needed flexible loan capital to help small businesses invest in their own growth and expansion plans, supporting job creation and growth in the critically important SME segment of the UK economy. Ultimately our objective is to become the direct lender of choice for SMEs operating in the UK lower mid-market.”

Catherine Lewis La Torre, CEO of British Business Investments, said: “British Business Investments is committed to providing capital to direct lending funds focused on SME lending, where there is a continued under-serve by banks and other lenders. We are pleased to make this commitment to Shard Credit Partners as it launches its first fund, and look forward to seeing new finance made available to SMEs throughout the UK.”

Shard Credit Partners is currently in advanced discussions with a broad range of UK and international institutional investors seeking to commit to the fund at a second close in early 2018. The team is planning to hold a final close for the fund at £250 million, with a hard cap at £300 million, by Q4 2018.