Driving Growth Through Buy and Build

Private equity investment can be a transformative catalyst for business growth when combined with a dynamic, ambitious management team and a strategy focused on achieving long and lasting value.

We know from the diversity of our portfolio - from the video gaming company Team17 to pest control business Pelsis – that each company’s growth opportunities are different and the growth strategies supported by private equity should reflect that.

One such growth strategy is buy and build.

LDC has a strong record of backing its portfolio companies in delivering acquisitive growth plans, buying and integrating complementary businesses to enter new markets at home and overseas, broaden their product and service offering and increase supply chain performance.

In 2018 we supported 25 acquisitions across our national portfolio, while more than a third of the businesses we currently back are pursuing a buy and build strategy.

BUY AND BUILD IN ACTION

We understand that our initial investment is just the start of a partnership and that the ability to provide follow-on funding is a key to success, particularly in times of uncertainty.

On a local level, five acquisitions in the first eight months of our partnership with Linley & Simpson has helped the group to expand geographically across Yorkshire, broaden the range of services it offers and bring ever more expertise into the business.

Insurance law firm Keoghs, part of our portfolio since 2012, is another business to embark on this type of strategy. It acquired the Insurance Business Group division of Hill Dickinson in a move that added significant depth and breadth to its service offer. The deal saw more than 400 staff transfer to Keoghs, marking an important step towards delivering on its vision of becoming the pre-eminent legal services provider for the UK insurance industry.

Buy and Build can also help drive international expansion. We recently supported Pelsis’ acquisition of US-based Curtis Gilmour in a deal that substantially grew its global presence. The deal created a group that is now one of the world’s leading providers of pest control products and equipment, and achieved valuable operational synergies which have provided an even stronger platform for future growth.

We also supported ZyroFisher’s acquisition of Royal Velo to support their expansion into France.

On each of these examples, we’ve worked closely with our portfolio companies to identify potential acquisition targets and assess them in terms of fit, growth potential and synergies. With the support of our Value Creation Partners we can also help with integration planning to make sure the benefits can be realised through both short-term opportunities to achieve immediate savings, alongside longer-term goals for maximising shareholder return.

Whatever path a business takes to achieve its growth ambitions, it’s our role to provide support and guidance along that journey.

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