Dunedin reaps 3x on £280m sale of Kee Safety to Investcorp

The deal generated a 3x multiple for Dunedin after a four-year holding period, equivalent to an IRR of 35%. The GP was invested in the company via its £300m third buyout fund.

Under the vendors' tenure, the company has undertaken an acquisitive international growth strategy, with a particular focus on Europe, North America, Asia and the Middle East. It has made 12 bolt-on investments and now has operations in 10 countries, compared to eight at the time of Dunedin's initial investment.

According to a statement issued by the vendor, as well as figures from unquote" data, the business increased its revenues from £35m to £78m between 2012 and its most recent financial year.

Following its acquisition by Investcorp, Kee Safety will continue to pursue its acquisitive and international approach to expansion. The deal is the investor's third UK investment in 18 months, following the acquisitions of cybersecurity provider Nebulas and school network management software provider Impero.

Dunedin's sale of Kee Safety comes a week after the GP floated asset and wealth management consultancy Alpha Financial Markets Consulting on the London stock exchange with a market cap of £163m. The firm reaped £89.6m from the Alpha IPO just 20 months after it acquired the company in a secondary buyout, equivalent to an IRR of 55%.

Debt
Lloyds Banking Group and HSBC provided a debt package to support Investcorp's acquisition of Kee Safety.

Previous funding
Kee Safety's history of private equity investment began over a decade ago when Barclays Ventures backed the company in June 2006 in a management buyout worth £26m, according to unquote" data.

In February 2011, LDC's Midlands team backed the SBO of the company, enabling Barclays Ventures to partially exit its holding.

Dunedin then invested £32m in the £90m buyout of Kee Safety in December 2013.

Company
Founded in 1934, Birmingham-headquartered Kee Safety provides fall protection systems, guardrails and safety equipment for working at height. The business has a headcount of 480 and generated a turnover of £67m in 2016, according to publicly available documents, with an operating profit of £17.6m.

People
Dunedin – Nicol Fraser (partner).
Investcorp – Jose Pfeifer (principal).
Kee Safety – Chris Milburn (chairperson).

Advisers
Vendor – Rothschild (corporate finance); Gateley (legal).

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