Corporate News

LDC commits increased capital to UK manufacturing sector – ‘£550million by end of 2016’

As the economic recovery continues, it’s clear that the manufacturing sector has a critical role to play in ensuring that British businesses can thrive in the global marketplace.

Throughout our 30 year history, LDC has committed more capital to the UK manufacturing sector than any other private equity house, reflecting our on-going commitment and ambition to supporting growing businesses in this space.

We’ve underlined the importance of manufacturers with a pledge to invest at least £550million into firms before the end of 2016, as we look to continue our focus on UK businesses within the mid markets sector with specialist engineering capacity in a range of industries, including niche sectors such as aerospace and oil & gas.

The renewed strength of manufacturing and specialist engineering in recent years is reflected in the fact that our initial investment target has increased dramatically since it was introduced four years ago, driven by the rapid rise of the sector, and the wealth of appealing investment opportunities that have arisen in the short period since 2011.

Our initial commitment of £200million quickly saw new investments completed with ten manufacturing and specialist engineering businesses right across the UK, including Dale Power Solutions, Bifold Group and MB Aerospace, placing total equity funding of more than £190million.

The rapid rate of these transactions meant that, by 2013, we were able to increase the commitment to £300million, underpinning our support of manufacturers. However, the continuing renaissance of the sector mean that this total, too, was also quickly exceeded thanks to deals with in Express Engineering and AIM Aviation, which was followed in 2014 by an investment to support the £42million management buyout of Eley Group.

The positive upward trajectory when it comes to investment opportunities in manufacturing firms has seen the target expanded to the £550million mark, with our most recent investments in Mini-Cam and BOFA International taking our current investment total to £341million.

Our focus on manufacturing has already seen us achieve some impressive gains of almost £75million which includes the recent sale of Bifold Group to Rotork plc.

This serves to reflect the increasing strength of the sector, whilst also underlining the benefits of our value creation plans, aimed at increasing efficiency and profitability within firms, and supporting management teams as they look to realise their full potential.

The Midlands heartland of manufacturing remains a key area of investment interest, but LDC’s network of offices across the UK ensures we are able to tap into the richness of the manufacturing environment on a nationwide basis, ensuring we can support the sector as a whole.

With the manufacturing industry continuing to grow and thrive amid the improving economic climate, we’re now working hard to identify new investment opportunities within the sector, as we strive towards achieving our £550million target within the next 18 months.

However, our commitment to manufacturers will continue unabated far beyond that point – just as it has over the past three decades.

For more information on LDC’s commitment to the manufacturing and specialist engineering sector in your region please contact the below: Scotland – Mark Kerr, Yorkshire & North East – John Garner, North West – Ged Gould, Midlands – Steve Aston, Rob Schofield, South West – Alistair Pendleton, London – Gordon Hague, South – Gareth O’Donovan

by Sophie Reed

Article Footnotes

Notes to Editors

  1. LDC is part of the Lloyds Banking Group and is authorised and regulated by the Financial Conduct Authority
  2. LDC back ambitious management teams from UK-based companies seeking between £2m and £100m of equity for management buy-outs, institutional buy-outs or development capital transactions.
  3. LDC invests in a broad range of sectors and has particular experience in Construction & Property, Financial Services, Healthcare, Industrials, Retail & Consumer, TMT, Travel & Leisure and Support Services.
  4. LDC has a UK regional network of 9 offices.