YFM, Calculus reap 5x on sale of Waterfall to LDC

Greg Gille
23 December 2014

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LDC has acquired catering business Waterfall from YFM Private Equity, Calculus Capital and Kaye Enterprises for ТЃ20m.

LDC backed the incumbent management team as part of the deal. HSBC provided a £10m senior debt and revolving credit facility to support the transaction.

YFM backed the £4.3m buyout of Waterfall Services from a private vendor in 2007. The company, then trading as Cater Plus Services, was targeted by two former Sodexho UK executives as part of a management buy-in deal. YFM led the equity investment with funding sourced from its British Smaller Companies VCTs, alongside other investors including Neptune-Calculus Income & Growth VCT and the Kaye Enterprises, a family trust. Together, the equity investors secured a minority stake in the newco. Yorkshire Bank supplied debt for the deal.

Since the 2007 buyout, turnover increased fivefold to £60m while staff numbers shot up from 400 to 3,000, according to the vendors.

Company
Founded in 1991, Waterfall is a contract catering business operating under two brands. Caterplus targets residential and care homes as well as welfare charities and shelters. Taylor Shaw meanwhile focuses on the education sector with contracts for state primary and secondary schools and colleges.

People
Richard Ibbett and Jonathan Bell led the deal for LDC - they will both join the board at Waterfall. YFM was represented by Angela Warner.

Advisers
Equity - Deloitte, Aziz Ul-Haq, James Worrall (Corporate finance); Addleshaws, Paul Medlicott, Katie Simpson, Richard Oman, Laura Marr, Chi Lam (Legal); DSW, Brentnall, Catriona Lang (Financial due diligence); PwC (Tax).
Vendors - Clearwater International, Paul Jones, Oliver Wheatley, John Davies (Corporate finance); DSW, Frank Shephard, Nicola Frost, Darren Ormsby, Nick Hawthorn (Financial due diligence).