NorthEdge Capital has invested an undisclosed sum in support of a Management Buy-Out of road tanker company Abbey Logistics Group, led by CEO Steve Granite. The investment represents the fourth deal transacted by NorthEdge this year and is the second investment out of the recently raised £300m Fund II.
The Liverpool-headquartered company was set up more than 25 years ago by the Lucy family, specialising initially in the liquid food ingredients transportation market, with more recent diversification into the bulk powder market, palletised transport and warehousing under the leadership of current CEO Steve Granite. Long-standing relationships with a number of pan-European blue chip customers have been built up over the years enabling Abbey to grow its business year on year to become a market leader in the food ingredients transportation market.
Abbey Logistics has demonstrated strong growth over the past five years with turnover increasing from £20m to over £55m in the current financial year following a number of acquisitions and large contract wins. The business employs over 450 staff and operates from six sites including Wirral, Hull, Manchester, Knowsley, Middlewich and London. NorthEdge, which currently has £525m of funds under management, focuses on northern investments from offices in Manchester and Leeds.
The funding will support the business as it continues to expand in an industry worth around £55bn to the economy. Abbey will be targeting growth with new and existing customers, as well as exploring a number of acquisition opportunities that management have been progressing in parallel to the MBO with support from NorthEdge Capital.
The deal will provide a full exit for the founding family and the business will continue to be led by Steve Granite as Chief Executive and Dave Coulson as Commercial Director.
NorthEdge Director Jon Pickering led the transaction, with support from Investment Manager Dan Matkin and Portfolio Director Ben Wildsmith. Private equity experienced Chairman Ian Kelly joins the Board at completion. The Board will be further strengthened post completion with the appointment of a Non-Executive Director and Group Chief Financial Officer who have already been identified.
Steve Granite, Chief Executive at Abbey Logitsics, said: “We are delighted to have partnered with Northedge Capital to complete the MBO and enable the Lucy family to exit the business realising their well-earned value. Northedge are the right partner for Abbey and we have been suitably impressed with the firm since our first meet earlier this year.
“It is an exciting new chapter in the Companies life and we are very much looking forward to continuing the successful journey we’ve experienced to date. Our customers and employees will benefit from the transaction as the new investment enables us to develop our business and continue growing from solid foundations. Through both organic and acquisitive growth Abbey will become the market leader in both the liquid and powder transportation markets over the coming years.”
Jon Pickering, Investment Director at NorthEdge Capital, added: “Abbey Logistics is led by an exceptional management team who have been with the business for more than 20 years. They fully understand the specialist logistics market they serve having carved out a niche by distributing bulk powders and liquids for the food ingredients markets.
“The company has demonstrated growth through a number of major contract wins and targeted acquisitions and this strategy will continue going forward with our support and follow on funding. We are pleased to have provided an exit opportunity for the founders and are looking forward to working with Steve and Dave as we target further expansion across the UK and Northern Europe.”
The company was advised by EY (corporate finance) and Napthens (legal). NorthEdge was advised by a number of regional advisory firms inclduing BDO (corporate finance), Pinsent Masons (legal), Graphene Partners (commercial due diligence) and EY (financial due diligence). KPMG provided support to Newco on IT due diligence and tax structuring.