Inflexion sells Reed & Mackay to trade

The deal is Inflexion's fifth exit in six months and follows the sale of UK-headquartered agricultural data and information platform Kynetec to sustainable food chain investor Paine Schwartz Partners in March 2021. The sale of Kynetec netted returns of more than 3x money and a 25% IRR on the sale, which valued the company at $225m, as reported.

Inflexion acquired Reed & Mackay in August 2016, investing via Inflexion Buyout IV. The fund held a final close in October 2014 on £650m, and deployed equity tickets in the £15-75m range, continuing the strategy of Inflexion's predecessor fund. The deal was also backed by senior debt from HSBC, Lloyds and RBS, according to Unquote Data.

During the investment period, the company grew organically, as well as via add-ons in the UK and internationally. These included the acquisitions of Hillgate Travel in May 2018 and the Business Travel Direct division of Ickenham Travel Group in July 2019. The company's international expansion also involved the opening of offices in New York, California, Toronto, Singapore, Amsterdam and India, according to a statement.

Inflexion said in the same statement that the company has continued to grow and develop in the past year, in spite of the challenging circumstances brought about by the coronavirus pandemic.

Previous funding
Livingbridge (then called Isis Equity Partners) acquired a significant minority stake in Reed & Mackay in May 2005, investing via its Baronsmead VCT. The trust invested £4.87m as part of a £10m deal. RBS provided senior debt to back the deal.

Livingbridge backed a £50m buyout for Reed & Mackay in April 2011, joined by ECI Partners. The deal generated a 4.8x money multiple and an IRR of more than 35% for Livingbridge's VCT, and was backed by debt from Lloyds. ECI invested via its ninth fund, which held its first and final close in December 2008 on £430m.

ECI and Livingbridge sold their stakes in the business to Inflexion in August 2016, netting a money multiple of 3.4x. A sale process for the company was initially launched in September 2015, Unquote sister publication Mergermarket reported, but the process did not complete, as buyers did not reach the valuation expectation of the vendors. In the 2016 sale process, Reed & Mackay was marketed based on EBITDA of around £10m, according to Mergermarket.

Company
Founded in 1962 and headquartered in London, Reed & Mackay is a corporate travel management company. The firm assists businesses with planning and managing cost-effective but high-quality travel. The firm has a Platinum Club service for VIPs and also offers specialist services for marine and offshore travel. Its R&M/Protect platform also includes a map that allows businesses to track travellers and the risk ratings of the areas in which they are located.

Reed & Mackay employs more than 500 staff, according to LinkedIn. According to its latest publicly available accounts, the company generated turnover of £64m and normal EBITDA of £18.8m in the financial year to 31 March 2020, compared with turnover of almost £46.8m and EBITDA of £17.4m in the previous year.

People
Inflexion Private Equity – Mark Williams (senior partner); John Breheny (investment director).
Reed & Mackay – Fred Stratford (CEO).

Advisers
Vendor – Baird (corporate finance); Ropes and Gray (legal).

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Exits
• UK / Ireland
• Consumer
• Trade sale
• United Kingdom
• Inflexion Private Equity