3i sells stake in A Warren & Sons to BSS Group
3i, Europe's leading private equity company, announces it has sold its minority stake in A Warren & Sons Limited ("Warrens"), a leading supplier of industrial products to the construction industry, to the BSS Group ("BSS").
BSS has paid £14.0m in cash on completion with a further amount of up to £750,000 maximum, payable in cash depending upon the working capital at completion. 3i's proceeds represent a money multiple of 3.3x and an IRR of 22%.
3i invested £1.7m in Warrens in February 1998 as part of the management buy-in. Since this investment, 3i has supported the business's growth from one to four branches and has introduced Nick Owen as Managing Director and Philip Butcher as Non-Executive Director.
Will Clark, 3i Director, commented: "Warrens has been a good investment for us. The business has performed strongly since we backed the management buy-in in 1998, quadrupling sales and expanding from one to four branches. The exit has generated a return of 3.3 times our investment."
Nick Owen, Managing Director of Warrens, commented: "With 3i's support, active involvement and strategic advice, Warrens has grown strongly over the last seven years. The building products industry is rapidly consolidating around a small number of large players and we believe this acquisition presents a great opportunity both for ourselves and BSS."
BSS is a leading distributor of heating, plumbing and pipeline equipment to the industrial and domestic construction markets. Through its branches in Oldham, Birmingham, Leeds and London, Warrens will enhance the range and depth of products supplied by BSS's Industrial Division. Gross assets of Warrens were £8.2m as at 31 December 2004 and operating profits were £1.5m.
Corporate finance advice was provided by Keith Pickering and Leigh Daveran of Catalyst Corporate Finance and Mike Hinchliffe led a team at Addleshaw Goddard providing legal advice.
This exit follows 3i's sale of William Wilson to Wolseley in November in an £81m deal.
Notes to editors
3i is a world leader in private equity and venture capital. We focus on buyouts, growth capital and venture capital and invest across Europe, in the United States and Asia.
Our competitive advantage comes from our international network and the strength and breadth of our relationships in business. These underpin the value that we deliver to our portfolio and to our shareholders. www.3i.com
3i Growth Capital
3i's Growth Capital business focuses on investing minority stakes in high growth companies expanding organically or through acquisition. The business currently manages 300 investments across Europe and Asia with a value in excess of €1.9bn and invests across a broad range of industry sectors, including healthcare, financial services, food & drink, media, IT services, support services and oil & gas.
Recent investments include Nimbus, India, €36m; Boxer, Sweden, €84m; Clinica Baviera, Spain, €40m; Williams Lea, UK, €68m; Renta Corporation, Spain, €20m; Novem CID, Germany, €25m; Vetoquinol, France, €20m and PEARL, Singapore, €8m. Recent exits include Cannon Avent, UK, €450m; Pets at Home, UK, €330m; Wood Group, UK, €37m; Ascent Technology, UK, €34m; Raynal, France, €0.5m and Highland Energy, Germany, €178m.