LDC has a good hair day with 350% IRR

06 November 2007

Tweet
Facebook
LinkedIn
Google plus
Send to

LDC has sold Jemella Group, the owner of the ghd (good hair day) hair-straightening brand, to Montagu Private Equity for £160m. The exit from Jemella yielded a money multiple of 3.5x and an IRR of 350% for LDC, which had held Jemella since July 2006.

LDC acquired Jamella for an undisclosed sum after Ernst & Young introduced the investment opportunity in late 2005 - following a collapsed auction process. Over the course of LDC's investment, staff numbers increased from 180 to more than 300 and turnover from £56m to £80m. Following significant shareholder value creation since its investment, LDC looked to a recapitalisation of the business. This led to interest from financial buyers and, as a result, LDC asked Ernst & Young to explore the possibility of an exit.

Montagu and the founder of Jemella are the two largest shareholders in the newco, with management holding the balance. The acquisition by Montagu took six weeks to complete from exclusivity and was supported by a £60m debt package lead-arranged by Barclays alongside Lloyds TSB Corporate Markets and HSBC. Founded in 2001 and based in Keighley, West Yorkshire, Jemella's hair products are marketed to more than 50,000 salons globally.

(Page 31).