London Property Maintenance Ltd (United Kingdom) - Nov 2007

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01 November 2007

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Sovereign Capital has completed the acquisition of Dependable Services Ltd, a contract cleaning and ancillary services business, on behalf of portfolio company London Property Maintenance Ltd (LPM), a provider of contract cleaning, security and maintenance services, for an undisclosed sum. Sovereign originally purchased LPM in a BIMBO in 2006, taking an 85% stake in the company for a total consideration of £10m, with a further £10m allocated to fund further acquisitions as part of a buy-and-build strategy (29 January 2007, page 39). This latest deal was sourced through corporate advisory firm Mazars, which was acting on behalf of the vendor in response to enquiries into the market made by Sovereign at the time of the original investment. Kaupthing Singer & Friedlander, which provided financing for the initial transaction, continued its support with the provision of a senior only debt package. The investors intend to continue the organic growth of the enlarged business in addition to making further acquisitions, with negotiations already underway with several targets that are expected to complete in the coming months.

Company

Dependable, based in Leeds, is a supplier of contract cleaning and related ancillary soft support services. The company serves 245 clients in the office and light industry sectors, with an offering that includes contract cleaning, one-off cleans, window cleaning, washroom services, feminine hygiene and direct janitorial services. The business was established in 1957 and has grown significantly, currently generating turnover of around £5m and employing 460 staff. LPM, founded in 1978, provides cleaning, security and maintenance services to a range of clients including shopping centres, retail outlets and office buildings. From its base in Kent the company operates nationwide, generating turnover in excess of £20m.

People

Paul Egan led the deal for Sovereign and will join the Dependable board along with LPM CEO David Howroyd.

Advisers

Equity - CIL, (Market/Industrial Due Diligence)Equity - Ernst & Young, Simon Carter (Financial Due Diligence)Equity - Haines Watts, (Financial Due Diligence)Equity - Heath Lambert, (Insurance Due Diligence)Equity - Liberty Corporate Finance, (Corporate Finance)Equity - Osborne Clarke, Conrad Davies, Paul Cooper (Legal)Equity - SJ Berwin LLP, Perry Yam, Sally Roberts (Legal)Management - Marriot Harrison, Duncan Innes (Legal)Vendor - BCMS, (Corporate Finance)Vendor - Mazars, Oliver Hoffman (Corporate Finance)Vendor - Moore & Blatch, (Legal)