ISIS exits SLC via trade sale

The private equity firm reaped an IRR of 21% and a money multiple of 2.4x on its original investment. SLC was acquired by its August Equity-backed competitor, Lifeways.

Previous funding
ISIS acquired a majority stake in SLC (formerly known as Paragon (UK) Ltd) in December 2006, following a restricted auction process run by TMG Corporate Finance. The enterprise value of the deal was £12m, while a debt package was supplied by Yorkshire Bank. Management retained the balance of the equity. ISIS also made further funds available for future acquisitions in the North of England. At the time, the investor recruited a new financial director and was planning to position the company as a dominant player in the supported living market. The business recorded an EBITDA of £1.5m on revenues of more than £5m for the year to March 2006.

The first acquisition came in September 2007, when Raglin Care, a provider of supported living services to adults with learning and physical disabilities, was bought. Yorkshire Bank again provided a senior debt facility. In April, ISIS backed SLC's purchase of Homelife Options Ltd, a company that provides supported living services to people with learning disabilities.

ISIS went on to support the firm in making a further three acquisitions, thus increasing SLC's client base and geographical spread to include Merseyside, Derbyshire, Yorkshire and the Midlands. SLC now has more than 900 service users, compared to around 200 when ISIS first invested. It has also grown organically and is able to partner with many more local authorities than previously.

A secondary buyout or trade sale were the anticipated exit routes for ISIS.

Company
SLC, based in Chorley, Lancashire, provides up to 24-hour supported living services to people with a range of learning and physical disabilities and mental health needs aged 16 and over. It was founded in 1996 with one house in the Salford area and has since grown substantially.

The business currently operates through five subsidiary companies; SLC Paragon in Lancashire and Greater Manchester, SLC Raglin in Merseyside, Signposts, Community Care Services and Individual Support Service. SLC now has 638 employees, compared to 230 in 2006, and has quadrupled its turnover to more than £20m.

People
Director Pete Clarke worked on the transaction on behalf of ISIS, alongside fellow directors James Titmuss, Liz Jones and owner Adam Holloway. Clarke and Holloway represented ISIS on the company's board. Charles Egglestone is the CEO of SLC.

Advisers
Vendor – Deloitte, Paul Lupton, David Jones (Corporate finance); DLA Piper, Paul Rimmer, Stephen Jones (Legal).
Management – Shoosmiths, Sean Wright (Legal); PricewaterhouseCoopers, Chris Glazier (Corporate finance).
Purchaser – KPMG, David Mortimore (Tax).

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• Topics
• UK / Ireland
• Exits
• Healthcare
• ISIS Equity Partners
• August Equity LLP
• United Kingdom