Doing deals before the holidays
And links to a few more zinger stories on Rainmakers this week
Hello Rainmakers,
There seems to have been a bit of a deadline set on getting a few deals signed off this week before, presumably, Rainmakers across the regions take get on flights to head off to summer hot spots.
We’ll look at a few of them today including NCC selling a Dutch subsidiary, LDC selling a biscuit factory and an absolute walloper of a deal for Inflexion to sell an insurance buy-and-build.
We picked through the Experian data too, which does show a dip in regional volumes.
But premium readers of Rainmakers have been treated once again to some really feisty commentary and courtroom drama.
Today’s story is for our Rainmakers subscribers, it’s the kind of fresh, detailed and genuinely insightful content we are committed to bringing you.
Don’t miss out. Subscribe today.
THE INC & CO CONTEMPT CASE - THE DIRECTOR’S CUT
This week, we’ve been able to bring you more details from a dramatic case involving Inc & Co, an investment business, a self-styled private equity disruptor, of which two of its directors have been found to have been in contempt of court, and a third associate has admitted to contempt too.
On Wednesday (31 July 2024) Judge Rajah produced a 27 page judgement, which covered the breadth of the case, which we summarised the main conclusions of on TheBusinessDesk.com, and described in broad terms how the conclusions were reached.
But for readers of Rainmakers we cover more details of the judgement, in particular the supposed roles of a legal team inside the business, and the existence of a director from the Seychelles by the name of “Rea Barreau”.
We also shared a very useful chart.
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THE NATIONWIDE - VIRGIN MONEY MERGER - A GOOD DEAL FOR CONSUMERS?
One of the advantages of our editorial team having been around a while, is we can provide some helpful context and background.
This week’s first Rainmakers post sees Michael Ribbeck take us on a tour of the UK financial services sector, and the wave of mergers and acquisitions that created the modern banking landscape.
It was meant to usher in an era of better choice and more competition for consumers. But did it?
All of it underpins the current merger between Virgin Money and Nationwide, which gives the largest existing building society a foothold in the business banking world too.
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NCC WIPES OUT DEBT IN ONE BIG DEAL
Make no mistake, the deal by NCC to sell Dutch subsidiary Fox Crypto, which creates and manage cryptographic products for encryption services, could be seismic.
As reported on theBusinessDesk.com, as NCC released its annual unaudited results, group net debt at 31 May 2024 was £38.5m.
The expected net proceeds of c.€74m (c.£62m) will clear the debts and “facilitate organic and inorganic growth in the Group’s Cyber Security business.”
Never ones to miss an opportunity to express a view, activist investor Kelso were quick off the mark to say it welcomed the move, but said the strong results (increased losses) were a good sign of progress.
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ENDLESS SELLS PET BUSINESS
Leeds-based private equity firm Endless has sold Kennelpak’s retail business, Pets & Friends, to family-owned PSR Trading, owner of retail chain Just for Pets.
It allows Nottingham-based Kennelpak, a pet specialist wholesaler, brand owner and distributor, to accelerate the growth of its Wholesale & Distribution division.
Following the initial investment in July 2017, Endless has supported the Kennelpak management team in transforming Pets & Friends into a service-led retail proposition offering pet parents an array of pet care services underpinned with a curated range of products and accessories.
Pets & Friends includes 19 stores, 17 grooming salons, a website and subscriptions service, a dog training centre and The Grooming Academy with locations predominantly across Nottinghamshire and Derbyshire.
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EUROPEAN FOOD GIANT TAKES THE BISCUIT FROM LDC
LDC has sold Hill Biscuits to Cerealto UK the biggest biscuit, breakfast cereal, snacks and pasta manufacturer in Europe.
The private equity arm of Lloyds Bank declined to reveal the financial terms of the transaction.
LDC first invested in Hill Biscuits in 2017 and has invested in new technology to improve manufacturing efficiencies and increase capacity.
LDC claim that revenues doubled to over £40m in 2024, including reporting sales growth of 44% for last year. In the last set of accounts filed for the business for the year to the end of 2022 it recorded sales of £26m and EBITDA of £536,178.
In turn, Cerealto is a portfolio company of Davidson Kempner Capital Management and Afendis Capital Management.
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RAINMAKERS SEMINAR IN BIRMINGHAM
As the corporate finance community anticipates the end of a subdued and uncertain period, the upcoming Rainmakers Seminar in Birmingham in September will explore the challenge of becoming deal-ready for 2025.
With a more stable policy landscape expected following the general election and some economic headwinds easing, the seminar will concentrate on several key areas:
Current market demand and appetite
Funders’ primary areas of focus
The increasing significance of factors beyond financials, especially ESG and data
Opportunities within the Midlands market and Rainmakers’ role in driving growth
Hear from Katie Trout, director of policy & partnerships at the West Midlands Growth Company on what opportunities are available for the corporate finance community to engage with across the region.
A keynote speech from a leading West Midlands business figure will follow, offering their insights into working with Rainmakers on M&A proposals and securing investment.
An expert panel consisting of Tom Hustler, senior investment director at Palatine, Nick Gillott, corporate finance partner at Grant Thornton, Deepak Parekh, senior director at Shawbrook Bank, with more speakers to be announced.
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BIG SALE PRICE ON INFLEXION EXIT
Private equity investor, Inflexion, has entered an agreement for the sale of its investment in David Roberts & Partners, the Southport-based insurance broker, to BMS Group, an independent specialist insurance and reinsurance broker, for a reported £425m.
Founded in 1977, but owned by Inflexion since 2021 DR&P has grown from a single site to employ 400 people in 25 offices across the UK and Europe, handling in excess of £620 million of premiums for their clients.
Its last set of accounts published in August 2023 showed that the business made EBITDA of £8.3m on sales of £23.3m for the year to December 2022.
Malcolm Coffin (above) wasn’t available to speak to us, but we do know that Inflexion re-invested in 2023 to support further growth of the business as part of a mergers and acquisition strategy to build a network in the regional insurance broking market.
As is common in many similar “buy and build” operations the business also made a significant investment in its technology infrastructure.
We could share with you a couple of quotes about how delighted everyone is. But we won’t.
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Tickets have been selling fast for our 2025 Rainmakers Conference.
It’s being supported by BGF, Dow Schofield Watts, NorthEdge, Palatine, Shawbrook, Squire Patton Boggs, while PHD Industrial Holdings is a breakout room partner.
So save the date for Rainmakers 2025 – Wednesday 26 March, 2025 – and secure your place today at The Point, Emirates Old Trafford, Manchester.
It will bring more opportunities to network, more amazing speakers, more candid debate, more inspiring entrepreneurs, but also a chance to discuss the challenges of value creation.
The first Rainmakers Conference this March sold out, with more than 400 people attending to hear the insights and perspectives from entrepreneurs, investors and advisors, and to network with senior figures from across the corporate finance community.
Click on this button to get your discounted tickets.
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