Radley & Co Ltd (United Kingdom) - Dec 2007

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01 December 2007

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Phoenix realised a multiple of 3.8x its original investment, representing an IRR in excess of 120% on its two-year ownership of Radley. The £130m deal value saw Phoenix take out £64m. Having received a number of approaches for Radley, Phoenix hired PricewaterhouseCoopers to conduct a strategic review in September and subsequently a competitive process was run to enable Phoenix to divest the business. Phoenix had already realised some value from the refinancing of the business in spring 2007. Phoenix acquired Radley in a £45m management buyout in 2006, investing £16.8m for a majority stake (13 March 2006, page 25).

During the two years of Phoenix’s ownership, Radley’s revenues increased by 47% and profits rose by 95%. Radley’s growth was achieved by bringing in a new chief executive and finance director to the business in 2006. Radley established a new head office in London and a new distribution warehouse in Milton Keynes. Under Phoenix’s stewardship, Radley grew by concentrating on its wholesale business as well as developing its retail strategy with the roll-out of three flagship stores in London and another in Manchester. Additionally the business positioned itself for international expansion. It also started selling through its website and benefited from a national advertising campaign. During the past two years, Radley also leveraged its brand into other accessories including purses, umbrellas and sunglasses.

Advisers

Debt - DLA Piper UK LLP , Phil Butler (Legal)Management - BDO Stoy Hayward, Alex Perry, Andrew Ware, Nick Spero (Corporate Finance)Management - Travers Smith LLP, Phil Sanderson (Legal)Purchaser - Allen & Overy , Derek Baird (Legal)Purchaser - Heath Lambert, Alan Pratten (Insurance Due Diligence)Purchaser - Pragma, Monica Lucas (Commercial Due Diligence)Vendor - PricewaterhouseCoopers, Sean William, Stuart McKey (Corporate Finance)