Unquote

BGF divests Duncan & Todd as part of LDC-led SBO

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BGF has sold its minority stake in Scottish opticians group Duncan & Todd as part of a £15m investment from LDC.

LDC investment director Colin Bennett declined to comment on the deal valuation, though he confirmed to Unquote that the GP has acquired a majority stake via the deal, with Duncan & Todd CEO Frances Rus taking a significant minority stake.

Under the vendor's tenure, the group bolted on 2020 Optical, invested in its manufacturing capabilities, expanded its footprint to comprise 28 stores across Scotland and introduced audiology services into some of its locations.

Following the deal, the company will look to make additional add-on acquisitions, roll out audiology services across all its locations and expand some of its existing stores.

As part of the transaction, LDC has introduced former Bupa Dental managing director David Leatherbarrow as non-executive chairperson. The GP's investment director Colin Bennett will also take a seat on the Duncan & Todd board in the capacity of non-executive director.

RBS has provided banking facilities to support the transaction. Bennett confirmed that this included acquisition finance to support the group's bolt-on pipeline.

At the time of publication, Unquote was yet to receive a response from BGF regarding the returns generated from the investment.

Previous funding
BGF first invested in Duncan & Todd in December 2013, when it invested £5.6m in order to expand its presence in the north-east, fund acquisitions, increase manufacturing capacity and support marketing activity.

The GP then provided follow-on funding of £3.5m to the business in February 2015 to fund its acquisition of 2020 Optical, and injected a further £1.3m into the group's lens-manufacturing division Caledonian Optical in March 2016.

Company
Headquartered in Aberdeen and founded in 1972, Duncan & Todd is an opticians. It operates across retail, corporate and manufacturing divisions, with an ophthalmic lens laboratory in Aberdeen. It has a headcount of 250 across its Duncan & Todd, Smart Employee Eyecare and Caledonian Optical brands.

According to a statement, the business generated a turnover of £16m in the year ending in March 2017, with EBITDA of £2m.

People
BGF – Patrick Graham (investor).
LDC – Mark Kerr (director); Colin Bennett (investment director).
Duncan & Todd – Frances Rus (CEO).

Advisers
Equity – Blackwood Partners (legal); KPMG (financial due diligence); Armstrong Transaction Services (commercial due diligence).
Company – CMS Cameron McKenna Nabarro Olswang (legal); Sentio Partners (corporate finance).

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