Deal summary

Catalyst has advised the management team of Leadbitter Group on the £40 million management buy-out of the business from Heijmans NV.

The Leadbitter Group, with a turnover approaching £400 million, delivers a complete turnkey service from feasibility and design conception, through planning and building regulations approval to construction to both the UK Construction and Affordable Housing markets. In recent years, the business has achieved considerable success resulting in it being named as UK Contractor of the Year at the 2009 Building Awards.

The buy-out was led by the founder and current Chief Executive of Leadbitter Group, Bob Rendell, who has joined forces with Bouygues Construction, a subsidiary of the quoted French group Bouygues, to acquire Leadbitter from Heijmans NV.

What difference did we make?

Following the announcement of a strategic review by the then parent company Heijmans, Catalyst worked with management for nearly 2 years, formulating a deal structure that was both acceptable to the vendors and deliverable in what is a very challenging market for many construction businesses.

Leadbitter operates in a market that is undergoing significant change. This required any deal structure to reflect these changes and allow the business to fully exploit the opportunities presented, whilst at the same time not over burdening the business with significant debt.

Our detailed understanding of the business’ needs culminated in presenting two alternative solutions. One was private equity backed and the other trade backed, working with Bouygues Construction. The final decision was to work with a trade party, the benefits of which were to:

- minimise the cost of finance to the business going forward with a limited senior debt package and significant equity support from Bouygues - Access to further funding to meet the growth plans for the business at a time when many competitors are struggling for finance - Provide a significant participation for management who acquired 49% of the business - Developed a structure that incentivised management to deliver strong profit growth in the medium term

Catalyst also advised the management team on the selection of their preferred funders and negotiated the deal on their behalf.

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What our client said
Catalyst’s strong construction sector experience coupled with an ability to think creatively about deal structures provided us with outstanding counsel during every step of the deal. Bob Rendell
Chief Executive, Leadbitter Group