KCP makes 3.8x money on Neville Johnson SBO

Amy King
30 May 2014

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Key Capital Partners (KCP) has sold UK-based furniture maker Neville Johnson Group to Alcuin Capital Partners in a ТЃ20m transaction.

The vendor enjoyed a 3.8x money multiple on its original investment.

The transaction includes a £10m equity commitment from Alcuin, which takes a significant stake in the company via its £100m Third Alcuin Fund. The Manchester-based team of RBS provided debt to support the deal.

The company intends to open eight new showrooms across the coming three years and increase its market penetration in the UK.

Previous funding
In 2008, KCP acquired the firm from Endless for £12.5m. The exit generated a 7x money multiple and an IRR in excess of 300% for the exiting investor after a holding period of two years.

Company
Founded 25 years ago and based in Manchester, Neville Johnson manufactures furniture and fitted kitchen products. The company employs 270 staff and achieved a turnover of £33m for the year to April 2014, representing a 20% uptick on the previous year's figures.

Under KCP's stewardship, the company has grown through organic and acquisitive growth, including the bolt-on of luxury fitted kitchen manufacturer Tom Howley. The bolted on company's revenues have risen from £2m in 2010 to £11m in 2014.

People
Investment director Nick Seaman and partner Mark Storey led the deal for Alcuin. Peter Armitage, partner at KCP and non-executive director at Neville Johnson, represented the vendor. Stuart Watson represented RBS in Manchester.

Advisers
Company – KPMG, Jonathan Boyers, Giles Taylor, Pinesh Mehta, Paul Dolyniuk (Corporate finance); Ward Hadaway, Sean Fitzgerald, Paul Johnson (Legal).
Vendor – Grant Thornton, Will Oxley, Julia Stokes (Financial due diligence).
Equity – Jones Day, Adam Greaves, Saffron Finch (Legal).