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LDC exits SRL Traffic Systems to 3i Infrastructure at 5.7x exit multiple, 124% IRR

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Lloyds Banking Group private equity arm LDC  has exited its investment in SRL Traffic Systems to 3i Infrastructure at 5.7x exit multiple and 124% IRR.

The company is an equipment-as-a-service provider for temporary, portable and semi-permanent intelligent traffic lights and variable messaging signs. It supplies some of the UK’s biggest infrastructure projects from its nationwide network of 30 depots.

LDC bought into SRL in 2019, investing £24m to support the company’s growth strategy. It said SRL’s revenues have grown by 72%, up from £18.4m in FY19 to £31.6m for the current financial year.

During the investment period, the company has increased its fleet from 7,500 to almost 13,000 systems, added four new depots and opened a new innovation and technical center. It also moved into a new combined manufacturing base and Head Office.

The company also hired new CFO, COO and CIO during the partnership, the firm said.

John Clarke, investment director at LDC in the North West, said, “Richard and his team have taken SRL from strength to strength, investing in every area of the business from talent and R&D to marketing and sales.

“And their success is plain to see, with a series of even more new product launches already on the horizon. We’re excited to see the business continue on its impressive trajectory in its new partnership.”

LDC sealed a £210m trade sale of ADEY to UK pipe making major Polypipe in February.

The deal came hot on the heels of LDC sealing a rapid exit of Texthelp to fellow buyout house Five Arrows after just 18 months in its portfolio.

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