Jobs secured as ’UK market leader’ acquired in buy-out
Fuel Conservation Services Limited (FCS) of Cannock was established in 1983 and was previously owned by Conservatherm Limited, a company controlled by Peter Havelock, an engineer who, with his then business partner, identified the potential for energy efficient furnace linings.
The management buy out – for an undisclosed sum - was led by Managing Director Mike Myatt, who has been with the business since 1990 and has been responsible for recent technical developments leading to new product ranges as well offering energy monitoring surveys to customers. The company employs 15 staff at its Littleworth Road site.
Alan Gardner of the Wolverhampton office of Haines Watts Corporate Finance advised the management team on the strategic restructuring of the business in late 2008 and early 2009, brought about by a severe decline in activity caused by the recession. Having stabilised the business with a robust business plan for the business to move forward, he was then able to construct a Management Buy Out to enable Peter Havelock to realise his long term investment in the business.
Finance for the transaction was also arranged by Alan Gardner with external funding provided by Venture Finance, who also provided further funding to support the growth and development of the business through the Enterprise Finance Guarantee scheme.
Mike Myatt said he believed the business has a bright and profitable future as it expands its operations following an intensive period of product development.
“We are well placed to continue to meet the needs of the UK market whilst export markets account for nearly 15% of our output, involving installation work throughout Europe and the Middle East. We also distribute our specialist lining products through European and Turkish agents,” said Mr Myatt.
Mr Gardner said he was impressed with the management’s approach and commitment.
“This is a classic example of a UK company that is strong on innovation and product development and has become recognised as a UK market-leader. It has faced tough times in the recession but the prospects for growth are significant and it is leading the way with its innovative engineering solutions meeting the needs of companies worldwide that are looking for reductions in their energy consumption.”
Guy Walsh, Business Development Manager at Venture Finance, who was responsible for constructing the financial solution which included bad debt protection of the company’s export debts, said the company had prepared well for its future growth.
“We quickly recognised FCS had been well managed for many years and there was a strong business plan in place, so we had no hesitation in providing funding for the deal. As part of the International Factors Group, Venture’s experience in working with associate companies overseas meant FCS’ international business model presented no problems.
“It is also an asset-heavy company, so we were able to structure a package to provide optimum working capital, both upfront and in an ongoing capacity, to support the post-acquisition phase,” he said.
Legal work on the complex restructuring and MBO was led by David Hughes of fbc Manby Bowdler of Wolverhampton.
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Date: 19-03-2010