It's all kicking off on the markets
Exits, acquisitions, speculation and a tight timetable for a demerger
Hello Rainmakers,
We have released the first wave of speakers for our Rainmakers conference on 26 March 2025.
Keynote speaker in the afternoon will be Thomas Ryder, CEO and founder of Applied Nutrition, with a tale to tell about his fundraising journey, including the latest step on that path, leading the biggest IPO of the year.
A lot of our news and analysis on this Free to all the curious Rainmakers this week is around stock market listed businesses.
Keep reading and we’ll also give you another tease for what you’ve been missing…
A flurry of stock market M&A looks like it’s becoming a looming tide.
This week as Dan Coatsworth, investment analyst at AJ Bell pointed out, takeovers have continued to be the dominant theme for UK stocks, with Oxford-based TI Fluid Systems the latest company heading for the exit. ABC Technologies has finally turned its 200p per share proposal into a formal bid and TI Fluid’s board is recommending shareholders vote in favour of the deal.
“Like many other takeover targets over the past few years, TI Fluid struggled to generate much excitement among investors and traded on the type of valuation that left it vulnerable to a bid. The shares have traded below eight times 12-month forward earnings since 2022, which put TI Fluid in bargain basement territory. It was only a matter of time before someone gobbled it up.”
Also in the crosshairs is Direct Line, following a bid from Aviva. Australia’s Ramsay Health tabled a £1 billion bid for Spire healthcare in 2021 but the target’s shareholders voted it down. Spire’s valuation has weakened considerably since mid-2023 and that looks to have put it on the radar of Indian private hospital group Narayana Health. Market chatter suggests Narayana is in talks to buy a controlling stake in Spire, sending shares in the UK stock up 8%, Dan reckons.
“Spire has been a frustrating share to put it mildly, barely changing price since late 2021, which means investors might welcome the opportunity to sell out to Narayana if it’s paying a premium.”
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A deal is brewing for listed Manchester-based consumer goods manufacturer and vaping specialist, Supreme, to take control of iconic tea maker, Typhoo.
The group, which reported an eight per cent jump in interim revenues of £113m for the six months to September 30, earlier this week, has revealed it is in talks over a possible deal to buy tea-maker, Typhoo, out of administration.
With Government legislation on vaping on the horizon it makes sense for the Trafford Park-based group to consider diversification, having successfully bought a drinks bottling business from NorthEdge this year.
In a stock exchange statement, it said: “The board of Supreme can confirm that it is currently participating in a process regarding the potential acquisition of Typhoo Tea. Whilst discussions with the administrators are now at an advanced stage, there can be no certainty that the potential acquisition will be completed.
“No final terms of the potential acquisition have been agreed but the company can, however, confirm that any potential offer would be funded by Supreme’s existing bank facilities.”
Typhoo previously operated from a factory in Moreton, Wirral, but in July last year shut the plant down, with the loss of 85 jobs, and relocated to a new headquarters in Bristol.
This, inadvertently, played a part in its unfortunate demise, resulting in an illegal occupation of the abandoned factory which resulted in internal damage requiring repairs in the order of £24m before it could be divested, putting further strain on company finances.
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Coventry Building Society’s £780m takeover of The Co-operative Bank has passed the regulatory test, with the FCA and PRA giving it the thumbs up.
Announced earlier this year, the Co-op Bank will go back to mutual status and become a subsidiary of The Coventry Building Society, keeping all its customer protections intact.
The deal, set to wrap up on January 1, 2025, will create a banking powerhouse with £89bn in assets and £70bn in mortgages.
With Coventry’s David Thorburn and Stephen Hughes at the helm, the duo is ready to shake up the high street.
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The board of THG intends to drive the formal split of its ecommerce services business IngenuityCo over the Christmas period with a view to clean break at the start of January.
A timetable released to the Stock Market this week showed that a General Meeting at the offices of law firm Clifford Chance on the 27th of December will confirm the votes of the shareholders.
But the ecommerce engine room will now be valued at £87m, a reduction from the initial price of £100m due to the application of an "adjustment mechanism".
After the demerger, THG will consist of the Nutrition and Beauty product divisions, and will be the largest customer of the privately owned IngenuityCo.
The document also reveals that co-founder John Gallemore will resign from the board of THG on completion of the demerger.
A significant proportion of THG's lease liabilities (£298 million) would also transfer with IngenuityCo on completion of the demerger, thereby reducing THG’s gross debt following the Demerger. Consequently, accelerating the deleveraging of THG, improving its credit rating.
THG's existing debt facilities, namely the €600 million term loan B, the £109 million term loan A and the undrawn £170 million revolving credit facility are expected to stay with RemainCo.
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Pets at Home CEO Lyssa McGowan has purchased almost £100,000 worth of shares in the pet retail giant.
This week she purchased 42,294 shares at £2.36 per share amounting to a £99,998.66 investment in the business.
On Tuesday, this week, in the commentary around a decent set of half year results she was brutally honest about a “subdued market”.
By Wednesday Pets was the worst performer among mid-cap stocks on the market, dropping down 12% at 243.40p, making the company the biggest loser in the FTSE 250 index in London on Wednesday morning.
It’s not enough to report a 47% year-on-year rise in pre-tax profits to £51.1 million from £34.7 million on a revenue lift of £789.1m from £774.2m last year.
Pets at Home stopped short of a profit warning, but admitted that "modest" year-on-year growth warranted “revising earlier guidance”. It certainly won’t be as much as the £144 million, anticipated in August, a 9.1% increase.
To quote her outlook in full, McGowan said: "The first half of financial 2025 was characterised by a subdued market, against which we outperformed. The bulk of our investments and peak operational risk are behind us and our market leadership and well invested platform underpin our confidence in continued outperformance."
The market will like her putting her own money in at this stage. But none of this will serve to dampen speculation about a private equity raid in the near future.
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Manchester-based McBride plc which manufactures and supplies private label and contract manufactured products for the domestic household and professional cleaning and hygiene markets, has refinanced.
A new facility consists of a €200 million Revolving Credit Facility (RCF) package, with a four-year maturity including an option to extend by up to two years.
The new arrangement with a syndicate of international banks includes a €75 million uncommitted accordion feature to provide additional facilities for potential future acquisitions or other financing needs, also with a four-year maturity.
CFO Mark Strickland, said the new facility gives the group “flexibility and security” as they look to grow.
“The refinancing secures improved terms and conditions on our borrowing facilities, reflecting the company's solid financial performance metrics.”
ON RAINMAKERS THIS WEEK
We interviewed Mark Payton, chief executive and founder of Mercia Asset Management, who from his office in Henley-in-Arden in leafy Warwickshire, was doing the rounds of investor roadshow presentations, interviews with media, and briefings to analysts, the staple diet of any leader of a listed business.
He said he believes the reason so few other venture and private equity businesses have achieved anything like the same scale as Mercia is down to the hard yards in building a regional network that brings opportunities to his team to invest into.
“You've got to find those businesses. So being based in London and doing desktop research to see what happens to be in Preston or Manchester or Leeds will not get you those great deals. You have to be physically there.
“We have 11 offices across the UK, 138 employees within Mercia, and we're physically out there, working with networks, working with intermediaries, and trying to find those businesses that are thinking of raising money, and we're able to develop that through proactive engagement,” he says.
We also spoke to Rob Darby, who sat down with our own Sam Metcalf to tell all about the deal to sell 200 Degrees to Nero Group and the tech driven app he’s investing his efforts into now.
What started as an independent coffee house, 200 Degrees has become the recognised meeting point in the 21 cities where it has a presence, gaining a particular cache amongst serious coffee connoisseurs, notably in Manchester, Leeds, Leicester, Cardiff, Derby and Liverpool.
A coffee lover himself, he set the business up with co-founder Tom Vincent to run not just the 21 shops but seven barista schools across the UK, and a wholesale arm that sells coffee beans online and to some chunky clients in hospitality and with a substantial concentration of coffee drinkers on site, like the biggest university in the UK, Manchester Metropolitan University.
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RAINMAKERS CONFERENCE IS BACK IN 2025
Our speakers have been revealed for the 2025 Rainmakers conference. They include those featured below, and many, many more.
twisted loop are excited to come on board as our headline partner. They join partners BGF, Dow Schofield Watts, KPMG, NorthEdge, Palatine, Shawbrook, Squire Patton Boggs & TDC.
And we have our breakout room partner PHD Industrial Holdings, drinks reception sponsor Marks Sattin, lanyard sponsor Gilbanks, table sponsor Datasite and umbrella sponsor T3C Group Ltd.
A powerful line up of speakers including high-calibre private equity backed entrepreneurs such as Ruth Percival, Helen Oldham and Thomas Ryder, the founder of Applied Nutrition and the chief executive of the biggest UK stock market float of 2024.
Hot topics on the packed agenda include how to create success in tech, the art of building value in a growing business, and making the case for private equity and corporate finance professionals on the political stage.
Newsworthy speakers will also include Shru Morris, anointed successor DSW, and Dave Richards, founder of IntelliAM, who has a tale to tell about his experiences with tech business WANdisco, and founder of Palatine private equity Gary Tipper.
Also appearing to set the political backdrop to the eventful year just gone will be Karim Palant, head of external affairs at the BVCA, and Greater Manchester Mayor Andy Burnham.
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.
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