Inflexion reinvests in BES

Katharine Hidalgo
08 February 2021

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Inflexion Private Equity has reinvested in British Engineering Services Group (BES).

The firm will retain a majority interest in the company, which was part of Inflexion 2010 Buyout Fund's portfolio. The deal sees BES transferred to Inflexion's fifth-generation flagship buyout fund, which closed on £1.25bn in May 2018.

Rothschild was appointed to run a sale process to select a minority investor for the company. Following the sale of a minority stake to AlpInvest, the valuation that was agreed upon through that transaction was then used as the basis for the transfer of the asset to Inflexion's Buyout Fund V, a source close to the situation told Unquote. "Part of why Rothschild was hired was so they could run a fair and transparent process for the transfer of this asset," said the source. The deal valued BES at £225m, according to Unquote Data. The company's management team continues to retain a stake in the business.

Since Inflexion's initial investment, BES has invested in its back office, its human resources, and technological development.

Previous funding
In November 2015, Inflexion carved out the engineering inspection and consultancy division from RSA. The firm drew equity from Inflexion 2010 Buyout Fund, which closed on £375m in 2010 and has one remaining unrealised asset: asset manager Succession, according to Unquote Data.

AlpInvest Partners also made an undisclosed investment in the company in February 2021.

Company
Headquartered in Manchester, BES provides engineering testing, inspection and consultancy services with a focus on health and safety compliance. The business is accredited to perform statutory inspections on plants, equipment and installations. It also provides technical consultancy, covering the key areas of pressure equipment, machinery, health and safety, certification, and thermography. The company was founded in 1859 and generated £45m in revenues and £7.6m in EBITDA in 2019.

People
Inflexion Private Equity – Florencia Kassai (partner); John Breheny (investment director); Nick Davies (investment executive).
British Engineering Services – Stewart Kay (CEO).

Advisers
Equity – Rothschild (corporate finance).