EmergeVest acquires Palletforce in £30m MBO

At 12.3x profits after tax (2014) and approximately £27.39 per share, EmergeVest's £30m winning bid represents a 94.6% premium on Palletforce's last traded price.

Although the company's shares are not officially listed on a stock exchange, trading has taken place on a matched-bargain basis – a system that allows investors to trade unlisted shares directly – since September 2001.

The acquisition of all shares, carried out via the Forcefield Bidco holding company, was financed through £28.9m in cash and £1.13m in loan notes paid to Palletforce's management in exchange for part of their shares. Led by CEO Michael Conroy, the team will stay as shareholders in the business as they roll over 41,207 shares.

EmergeVest, which initiated the takeover process after approaching Palletforce, drew equity from its $30m Fund B. The Hong Kong-headquartered firm typically targets companies within the transportation and logistics sectors in the UK and China.

Under the GP's tenure, Palletforce will seek to expand internationally with a focus on the Chinese market, with plans to introduce the company's business model at the regional level in the country.

The business, currently in partnership with 87 transport companies, will look to grow in other European markets by securing further similar agreements. In addition, funds will be dedicated to bolstering the existing IT system and building new hub facilities.

Company
Founded in 2001, Palletforce is a freight transport service that currently employs 160 professionals.

Through its hub in Burton-upon-Trent, the business offers a network of 87 transportation companies a shared space to drop and pick freight as they travel around the country. The company operates an additional 100 goods depots across the UK and elsewhere in Europe. 

In 2014, the company posted £18.36m in revenues, with a reported £10.82m in gross profit and £3.07m in profits before tax.

People
Heath Zarin is managing director at EmergeVest. John Brotherton is chairperson at Palletforce, while Michael Conroy is the company's current CEO.

Advisers
Equity – KPMG (Corporate finance).
Company – Cattaneo (Corporate finance).

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• UK / Ireland
• Buyouts
• Support services
• United Kingdom