PHD Equity completes MBO

The company went into administration in 2011.

PHD Equity completed the acquisition, valued at more than £5m, through a newco, Davenham Portfolio Management. The newco acquired the residual lending book of the firm only.

The GP bought Davenham through a new debt vehicle, PHD Equity Partners Debt SPV No 1, which was raised with the sole purpose of funding this latest acquisition. The debt fund holds capital commitments from a number of high-net-worth individuals and the firm's directors.

The buyout will allow Davenham to continue lending to SMEs in the north of England.

Reuben Berg at Berg introduced PHD Equity to the company, while O'Connors provided legal advice to the fund.

Company
Founded in 1982 and based in Manchester, Davenham began as a privately owned finance firm, lending in property, asset finance and trade finance. In 2008, the firm listed on the AIM market.

The company ended its exposure within property finance, small ticketing leasing and professional loans during the financial crisis. The firm went into administration in 2011, weighed down by bank loans of around £65m.

The company was unable to source traditional debt facilities and as a result turned to PHD Equity Partners.

People
James Dow is a managing partner at PHD Equity.

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