Stewart Group Holdings wins £12m in a BIMBO
Funding will enable company accelerate its growth
Gardening product manufacturer Stewart Group Holdings has secured £12m in a buy-in management buyout (BIMBO) deal led by mid-market private equity investors ECI.
Under the terms of the deal Lee Mowle, previously owner and chief executive of Stewart, will remain with the business as a managing director and substantial shareholder, and the company’s three other senior managers will also take shares.
Mowle’s position as chief executive will be taken by technical plastics expert Richard Butler, and Ken Lindsay and Eleanor Blagbrough of ECI will join the board. The funding will enable Stewart, which earned a valuation of £17m as a result of the deal, to accelerate product development and acquire businesses in its existing core markets.
Stewart turned over £15m in 2010 and its products are now stocked in more than 600 garden centres and DIY stores with its major clients including Homebase, Wilkinson and Dobbies.
Established in 1945, the company has a long and chequered history, having listed on the London Stock Exchange in the 1960s before being acquired by Bunzl in 1985, and undergoing its first buyout in 1999.
Since Mowle joined the business in 2003, the company has generated strong growth, principally through a core focus on product innovation.
Commenting on the acquisition, Mowle said: “At Stewart, we have worked hard and successfully for the last eight years, first to turn round the business and return it to growth. We now see lots of new opportunities for the business opening up in both our existing and new markets, and I am delighted to bring in ECI and Richard as partners to help us do so.”
New board member Lindsay said that Stewart has “great potential to continue to grow and develop further”, adding that it “is exactly the kind of business that ECI’s manufacturing team likes to back. It is a good, old fashioned, British manufacturing company that has moved with the times and developed a strong position in an attractive market, as well as earning strong customer loyalty.”
ECI has a strong track record of successfully backing high-growth companies, which have included businesses such Tragus (the Café Rouge and Bella Pasta restaurant chains), Bargain Booze, and Laterooms.com.