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Growth Journey - Nuclear Engineering Services

We completed the sale of our stake in niche engineering solutions business Nuclear Engineering Services in a £30m transaction with Ansaldo Energia Group, Italy’s largest supplier, installer and service provider for power generation plants and components in may 2014.

With a trading history in the nuclear sector dating back to the 1950s, NES supplies bespoke solutions into nuclear decommissioning, nuclear new build and defence sectors.

This is a fascinating business that has provided equipment to all of the UK’s nuclear power stations in both active and decommissioning phases, and is responsible for the design, construction and commissioning of three large and highly complex Silo Emptying Plants for remote material extraction from one of the principle storage buildings at Sellafield.

After backing NES in 2009, in challenging market conditions, we worked with the business to implement a strategic growth plan that included the build of a new engineering and manufacturing centre in West Cumbria, the expansion of its decommissioning operations, and the installation of state-of-the-art CNC machinery at its manufacturing facility in Wolverhampton.

During our investment holding period we also on-boarded a new senior management team, enabling the business’ original CEO, Brett Cooper to step away from his executive responsibilities. The transition from owner management to a more corporate structure was well executed, and within a short timeframe, the considerable expertise of NES’ new MD Mike Hawe in managing the challenges of a contracting business proved to be invaluable.

We helped to guide the business through these growth chapters, and ultimately our partnership with NES proved to be a great success story. We used grant funding and R&D tax credits to generate income and drive growth and during our investment holding period, NES was able to repay acquisition debt in its entirety.

Annual turnover more than doubled to over £37m, while employee numbers increased by over 180 people within five years to reach 420 staff, and in 2012, the business received full corporate accreditation from the Association of Project Management and saw the launch of a new manufacturing facility at Sellafield.

NES was one of just 34 companies to obtain this prestigious industry accolade, giving its customers complete confidence that all of its skilled project managers and engineers adhere to the very highest standards of best practice and professionalism in specialist engineering. This recognition was a proud achievement – not only for the business, but also its highly skilled people.

The sale of NES to Ansaldo Energia Group represented a great outcome for NES, providing the business with a solid platform from which to progress further by creating an enhanced and significant capability in the nuclear sector. Delivering a 2.2x money multiple for LDC, this successful exit demonstrated the true value of our strategy to invest through the cycle.

Tony Eckford, NES' Non-Executive Chairman Said: “LDC provided a healthy balance of support and challenge to NES, and during their investment period, the business more than doubled in size.

“LDC’s Midlands team was a fundamental part of our shareholder structure for five years, providing a ‘bedrock’ position for our business, supporting guarantees and giving our customers confidence that NES had parentage of substance.”

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by Sophie Reed