South Yorkshire Investment Fund (SYIF), a vehicle managed by UK private equity firm YFM Equity Partners, has made two-times its money on Naylor Industries after selling the building materials manufacturer back to its management.
As part of the deal, HSBC is providing Naylor with £14m of new debt facilities, which includes invoice and equipment finance, and has been structured to support Naylor’s international growth plans.
Full financial terms of the deal were not disclosed.
SYIF initially invested in Naylor Industries in January 2008. Since then it has made two further investments in the company to support operational improvements and new product developments.
YFM Equity Partners also introduced former Sheffield Forgemasters chairman and chief executive David Fletcher as non-executive chairman of the business.
Naylor was founded in 1890 and its head office is based in Cawthorne, Barnsley.
Current chief executive Edward Naylor represents the fourth generation of the family to head up the business, which today employs 230 staff across manufacturing sites in South and West Yorkshire, the West Midlands and Fife.
In the year to February 2012 the company posted a 14 per cent increase in turnover to £36.6m with operating profits of £2.4m.
The company primarily manufactures pipes, such as clay sewer and plastic ducting and surface water drainage pipes. Its other activities include a concrete lintel business and most recently a flowerpot business which trades under the name The Yorkshire Flowerpot Company.
Although builders’ merchants are the main UK customers for Naylor’s products, the export market continues to grow, with almost 20 per cent of current turnover from such markets as Australasia, South East Asia and Middle East markets.
“We have worked closely with Edward and David to help the company develop new products and internationalise its offering,” YFM portfolio director Angela Warner said in a statement.
“It has achieved good success in these areas against a tough economic climate.
“It is a strong manufacturing business that can develop new products that the market demands. We wish the team continued success in the years ahead.”
South Yorkshire Investment Fund is now focussing on the realisation of its investments, while Finance Yorkshire has taken on the role of investing in companies across Yorkshire and Humber.
Legal advice was provided to SYIF by Nabarro and to Naylor by DLA Piper.
PwC provided due diligence and law firm Irwin Mitchell provided legal advice to HSBC.
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