Motherwell Bridge team completes MBO
Management who led the turnaround of the struggling Lanarkshire engineering contractor Motherwell Bridge Ltd. have secured backing for their acquisition of the business.
JOHCM Private Equity, the private equity division of J O Hambro Capital Management Ltd., has supported Motherwell Bridge’s chairman Hugh Hayes and 11 other senior managers in their purchase of a 26% stake in the group.
The management team’s investment is around £3.9m and a new debt and banking package has been provided to the company by Royal Bank of Scotland.
Between them, JOHCM Private Equity and the management team invested some £15m, Hayes said.
JOHCM Private Equity was a shareholder of the old group prior to 2003, when Hayes led a rescue of the loss-making firm.
Hayes said the management team has been considering a management buyout of the business and looked at a number of partners before deciding to work exclusively with JOHCM Private Equity on an offer to the bank syndicate and the old Motherwell Bridge pension scheme, which between them held a majority stake in the company.
“The outcome of the deal is that the bank syndicate, which has supported us fully since 2003, recovers the debts it was exposed to at that time, and the old pension scheme receives an additional £5m to add to the £2.9m we’ve paid to it in the last three years as part of the compromise agreement set up at that time,” said Hayes.
“I’m particularly pleased with this, as three years ago there were no other offers on the table which did anything for the pension scheme members at all.”
© Crimson Business Ltd. 2006