The company, based in Frimley, Surrey, is the UK’s leading provider of average speed camera systems with Home Office Type Approval, which is required for legal enforcement.
Its products have been used in almost 250 locations by the Highways Agency and Local Authorities to improve safety and driver behaviour on motorways and trunk roads, during maintenance works and along routes with a collision history.
The systems are widely considered to be more effective than so-called ‘spot’ or ‘fixed’ cameras at regulating motorists’ speeds, in turn helping to reduce serious injuries and improve traffic flow. They also help to improve roadworker safety – a key objective for the Highways Agency. Unlike traditional cameras, they also issue fewer penalties, relying instead on reinforcing positive driver behaviour.
As part of the transaction, LDC will make a £9million investment in return for a significant stake in the company.
Bruce Brain will join the board as chairman, alongside LDC investment director Ian Podmore. A package of senior debt funding was also provided by HSBC Leveraged Finance to support the company’s expansion.
Following the investment, SCS plans to accelerate its new product development programme.
SCS now expects to double its annual sales over the next five years as a growing number of authorities switch from fixed to average speed cameras. The systems are increasingly being deployed in urban areas to calm traffic as an alternative to more visually intrusive measures, such as road humps and chicanes.
Paul Davey, chief executive of SCS, said: “This is an exciting development for our customers and employees, and an important endorsement by LDC of our business model, team and proposition.”
He added: “For over 10 years, our products have been helping to enhance driver and roadworker safety and improve traffic flow on the UK’s motorway and road network. This investment will enable us to harness new technologies as we address the changing needs of our customers, as well as further expand our nationwide infrastructure.”
Ian Podmore, investment director at LDC, said: “In SCS, we’re backing a fast-growing business with a high calibre management team and an unrivalled reputation for best in breed technology. The strength of its expertise and customer base provides an excellent opportunity to develop its products and make a significant contribution to the government’s objectives in improving road safety as well as potential environmental benefits.”
He added: “LDC has a history of supporting the funding requirements of fast-growing, small and medium sized companies and SCS reinforces our commitment to this important UK market segment.”
Kevin Beevers, Head of HSBC Leveraged Finance, West & Wales, said: “SCS benefits from a unique position in its market coupled with a solid strategy and visionary management team. As a result we are pleased to support a transaction which provides a strong platform to allow the business to meet its target of doubled sales over the next five years. The transaction highlights HSBC’s continued commitment to supporting businesses with clear objectives driven by sound management teams.”
SCS’s wirelessly connected digital cameras use Automatic Number Plate Recognition (“ANPR”) technology to measure average speed between defined entry and exit points, with data being stored in a repository for retrieval by the relevant police authority.
For further information, please contact:
Martin Currie
Citypress
T. 0161 235 0310
M. 07976 291532
E. martin.currie@citypress.co.uk
James Lloyd-Davies
Citypress
T. 0161 235 0308
M. 07782 135828
E. james@citypress.co.uk
Debt provider:
HSBC Leveraged Finance (Kevin Beevers, Paul Crocker, Melissa Leung)
Burges Salmon (Sandra Forbes) – bank legals
Advisors to LDC and Newco:
Ernst & Young (Derek Smith/Michael Cartwright) – Financial Due Diligence
Ernst & Young (Mike Thorne) – Tax Due Diligence
PwC (Simon Viner/David Burke) – Tax
Andeman (Charles Gay) – Commercial Due Diligence
Tyler Mangan (Jonathan Chocqueel-Mangan/Jana Klimecki) - Management Due Diligence
Shoosmiths (Sean Wright/Emma Gibson) – Legal
Willis (Brian Hendry/Jon Armstrong) – Insurance Due Diligence
Target Corporate Finance (Jim Shaw) – Financial Advice
Advisors to Management:
Equity Growth Partners (Matt Eves) – Corporate Finance Advisory
Roxburgh Milkins (Jason Milkins) – Management Legals
Deloitte (Sam Hart) – Management Tax
Advisors to Vendor:
Clark Holt (Jeff Jenkins) – Solicitors