LDC sells Mountain Warehouse to management

Ellie Pullen
04 November 2013

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LDC has divested Mountain Warehouse, a UK-based outdoor clothing and equipment retailer, in a management buy-back worth ТЃ85m.

LDC realised a return of more than 2x its original investment through the sale.

Mountain Warehouse's management completed the acquisition of the business with the support of asset management firm Alcentra and Royal Bank of Scotland.

The company's founder and CEO, Mark Neale, led the management team in the transaction. The company's management now wholly owns the business.

LDC invested in Mountain Warehouse in August 2010, acquiring a minority stake as part of a £47m deal. The GP was believed to have acquired a 25% stake in the business for £10-15m, according to unquote" data. RBS provided debt for the transaction.

LDC acquired the business from Arev, which had bought the business in a tertiary buyout from NBGI Private Equity in July 2007 via its private equity arm, Kcaj. Arev paid £15m for its stake, while a majority shareholding was acquired by the Mountain Warehouse's management. NBGI reaped a 6x return on its investment through the sale.

NBGI had invested in Mountain Warehouse in August 2002, buying the company in a secondary buyout from 21 Invest. NBGI acquired a majority stake in the business via the newco created for the transaction, Mountain Warehouse Holdings, according to unquote" data.

Company
Founded in 1997 and headquartered in London, Mountain Warehouse is a chain of 169 stores across Europe, with the majority in the UK and six recently opened in Poland. The business sells outdoor clothing and equipment, such as running gear, tents and rucksacks.

Since LDC's investment, Mountain Warehouse has created 500 jobs and opened 60 new stores. The company recorded turnover of £75.6m for the year ending February 2013, compared with the £47.5m generated in the year of LDC's investment. The company employs approximately 1,200 staff.

People
Mark Neale is the CEO and founder of Mountain Warehouse. LDC director Carl Wormald led both the original deal and the divestment for the firm. Investment director Bertie Aykroyd also worked on the exit for LDC.

Advisers
Vendor – Deloitte (Financial due diligence); Pragma (Commercial due diligence).
Company - Wragge & Co, Ian Piggin, Nick Crabtree, Kirsty Barnes, Jonathan Segal (Legal).