UK mid-market private equity provider LDC has committed to invest a total of £500m into manufacturing and specialist engineering sector by the end of 2015.
The firm has invested more than £250m in the sector within the last two years, having announced an initial commitment of £200mn in October 2011, which was then increased it to £300m in 2013.
The £500m commitment will continue to focus on firms with specialist manufacturing capabilities across a wide range of niche industrial sectors such as aerospace, power generation and oil and gas, and will be open to all UK mid-market businesses in the £10m to £150m enterprise value range.
LDC made seven new investment transactions into manufacturing and specialist engineering businesses in 2013, whilst also realising capital gains of over £95m from the sector. This included strategic exits from international aerospace engineering group MB Aerospace, and AIM Aviation, a provider of cabin interior design to the aircraft industry.
LDC has now committed more than £770m of funding across 139 transactions to the manufacturing sector in its over 30 year history. The private equity firm’s existing industrials investments account for more than 20 per cent (by volume) of LDC’s total investment portfolio, representing over £260m of investment.
Whilst LDC’s interest in the sector encompasses businesses located right across the UK, the initiative will continue to be led out of LDC’s Birmingham office by investment directors Steve Aston and Rob Schofield, the firm said.
Aston said,“UK manufacturing enjoyed further sustained growth in 2013, with the latest CBI Industrial Trends Survey reporting that the size of total order books and the pace of output growth in the sector for the past three months to December 2013 were the highest recorded since 1995. This on-going improvement in trading conditions represents a sound opportunity for manufacturers and we want to support these businesses in delivering their growth objectives.”
Transactions completed by LDC in 2013 within the manufacturing and specialist engineering space included backing the MBO of Rimor, a minority investment in Express Engineering, and the MBO of Angus Fire.
Copyright © 2014 AltAssets