Bregal buys Ideal Stelrad despite RBS backlash

Alice Murray
16 August 2013

Tweet
Facebook
LinkedIn
Google plus
Send to

Bregal Capital has acquired boiler and radiator company Ideal Stelrad, despite attempts by RBS to block the ТЃ230m deal.

London-based Bregal completed the acquisition after lengthy talks with the company owners. However, RBS, which holds a 15% stake in the company, had planned to break up the company and sell its operating divisions separately.

Ideal Stelrad has a long history of private equity ownership. Previously named Caradon Plumbing, the company was bought by Montagu (known as HSBC Private Equity at that time) for £496m in 2000. Montagu later sold off two of Ideal Stelrad's divisions – Twyford Bathrooms and Mira Showers.

The remainder of the company was then purchased in May 2005 by Warburg Pincus in a deal worth €333.48m, with the private equity house supplying €105.77m in equity, a further €176.29m provided in debt by BNP Paribas and RBS, while Intermediate Capital Group supplied €54.42m in mezzanine.

However, Warburg's refinancing of the business in 2007 left Ideal Stelrad unable to keep up debt repayments and it later breached its borrowing covenants. The debt-for-equity swap saw RBS taking a 15% stake in the company.

Bregal and RBS did not respond to requests for comment prior to publishing.

Company
Ideal Stelrad manfactures and supplies a wide range of radiators and towel warmers.

The company employs 1,800 people at its site in Mexborough, Yorkshire.

Ideal Stelrad is present in Belgium, Netherlands, Romania and Turkey through sister comapnies.

People
The company's chairman Richard Connell will step down once the deal is complete.

Advisers
Equity - BNP Paribas (Corporate finance).