Baird Capital exits Clearwater in £11m deal

Marlowe announced that the value of £11m, payable in cash on completion, will be funded with the proceeds of a share placing, conducted by an accelerated bookbuild process. The placing intends to raise gross proceeds of up to £20m through the issue of up to 4,694,836 new ordinary shares.

With this acquisition, Marlowe plans to broaden its technical capabilities and strengthen its position in the water treatment and hygiene market, with the group's enlarged water services business expected to reach revenues of £75m. The deal is forecast to be at least 10% earnings accretive by the financial year ending 31 March 2021.

Upon completion, Clearwater will be integrated into WCS Group, Marlowe's water operation, which is expected to realise significant synergies while broadening the capabilities of the combined business.

Marlowe specialises in safety and regulatory compliance of commercial properties, focusing on health and safety, fire safety, security, water safety, water treatment, air quality and environmental services. Its customer base includes SMEs, local authorities, facilities management providers, multi-site NHS trusts and FTSE 100 companies. The business generates annual revenues of around £130m.

Baird Capital acquired a majority stake in Clearwater in March 2015. As part of the deal, Baird managing director James Benfield joined the company's board. The acquisition was made through Baird Capital Partners Europe Fund II, a £125m vehicle closed in 2013. In addition, RBS provided senior financing for the deal, as well as a line of credit for acquisitions in order to support Clearwater's growth strategy.

Company
Founded in 1990, Camberley-based Clearwater provides water treatment, hygiene, engineering and pump services across the UK and Ireland. It has approximately 2,400 customers in a wide range of industries, including healthcare, education, food processing, leisure and public services.

The company reported revenues of £27.9m and gross profit of £12.3m, but an adjusted EBITDA loss of -£170,000. It employs 375 staff across 11 locations.

People
Clearwater Group – CEO Guy Rowley (CEO).
Baird Capital – James Benfield (managing director).
Marlowe – Alex Dacre (CEO). 

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