BGF in partial exit from York Mailing

Greg Gille
04 September 2015

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Printing specialist York Mailing Group has undergone a management buyout backed by Pricoa Capital Group, resulting in a partial exit for existing backer Business Growth Fund (BGF).

The management buyout was led by current CFO Stephen Goodman.

Pricoa is the international arm of Prudential Capital Group, the unquoted investment platform of insurer Prudential. The group invests predominantly in fixed-rate senior debt, as well as subordinated debt and preferred equity.

The deal will see BGF partially exit the business, in what would mark the GP's first divestment since inception, according to unquote" records. BGF committed £10m to York Mailing in July 2013 to support the company's acquisitive growth strategy and to fund the purchase of new printing presses.

In August that year, York Mailing bought The Lettershop Group, a UK print, marketing and mailing business. The acquisition created a group with turnover of around £100m and a headcount of 500. The bolt-on was funded from capital provided by BGF in its initial investment. York Mailing completed its second bolt-on with the acquisition of direct marketing agency Go Direct Marketing in 2014.

BGF will remain invested in the business following this partial exit.

Company
Founded in 1999, York Mailing produces retail flyers, media inserts and catalogues. Its clients include Marks & Spencer, Tesco, Lidl, The White Company, Cotton Traders and Boden.

The company generates £100m in turnover and £12m in EBITDA – compared with £69m and £7.5m respectively at the time of BGF's investment.

People
Richard Taylor led BGF's investment in York Mailing.

Advisers
Vendor – Pinsent Masons, Andrew Phillips, Catherine Hemsworth (Legal).
Company – KPMG, Chris Stott, Jon Terry (Financial due diligence); CIL Management Consultants, John Whiteman (Commercial due diligence); Lupton Fawcett Denison Till, Giles Clegg (Legal); DC Advisory, Richard Pulford, Ben Thompson (Corporate finance).
Acquirers – Clearwater International, Jon Hustler (Corporate finance); Browne Jacobson, Gavin Cummings (Legal).