Tuesday, November 14, 2006

Multi-million pound package finances MBO

GE Commercial Finance's Business Finance unit has provided a multi million pound financing package to facilitate the management buy-out of UK-based Lymington Precision Engineers.

GE Commercial Finance's Business Finance unit today announced it had provided a multi million pound financing package to facilitate the management buy-out of Hampshire-based Lymington Precision Engineers (LPE). LPE, part of the Fullers Group, was founded in 1980 and is a leading manufacturer of precision-machined drilling components that are used by the major oil companies across the globe for oil exploration. It also provides machined components, fabrications, assemblies and kit sets for the telecoms, defence, space, medical and marine industries across the globe.

The current owner, Leon Crouch is now handing over the reins of the company to the existing management team, while maintaining an interest in LPE.

Commenting on the deal, Andrew Rutherford, GE Commercial Finance, Business Finance director said: 'This is a great deal - a successful, well-established company in a niche market, a strong management team, backed by a great workforce, and a clear vision.

We worked closely with corporate finance specialists Peter Grinyer and Rosemary Penn-Newman of Fanshawe Lofts to set up this deal and without their close involvement, it would not have taken place.' Rutherford said: 'Succession planning is about finding the right exit strategy when you are ready to hand your business over to somebody else.

The task of finding and training a successor can be challenging for a business owner but it an essential element of a succession plan - and Leon Crouch has approached this with much thought and detail.

We look forward to supporting the MBO team in the continuing development and growth of the business.' The financing package consists of invoice discounting, a plant and machinery facility and a cash flow loan, which has provided the management team with the means to complete the deal.

The management team was led by managing director Tony Chalk, and its new board also includes David Craig, Chris Fletcher-Jones, Joanne Caulkett, Martin Palmer and Rob Hiscock.

The success of LPE has been driven by the effective business relationships it has developed with a host of multi-national blue chip companies to deliver specialist engineering-based services.

This has been coupled with significant capital investment and the development of a highly skilled workforce.

'The buy-out of LPE from the Fullers Group has been a complex and fascinating project to advise on,' commented Rosemary Penn-Newman of Fanshawe Lofts.

'It has required a large team of advisers to focus on providing a cohesive approach to making the deal happen and I'm delighted that we have achieved that so smoothly.' Peter Grinyer, concluded: 'LPE has a new management team which combines enormous experience and capability.

It is also retaining the support of Leon Crouch during this important next phase of its development and the opportunities for the businesses going forward are significant.'