Lyceum's UKDN buys Waterflow

Greg Gille
19 October 2011

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UK Drainage Network (UKDN), a portfolio company of Lyceum Capital, has acquired Slough-based Waterflow Holdings.

The GP injected new equity of an undisclosed amount to finance the bolt-on.

The merger creates a £50m turnover business with a 500-strong workforce. Lyceum stated this is the first in a series of upcoming acquisitions for UKDN, as the company aims to consolidate the highly fragmented drainage services market.

HSBC's Birmingham office rolled Waterflow's existing debt facilities into the new structure.

Previous funding
Lyceum acquired a majority stake UKDN in January 2010. A number of strategic acquisitions had already been identified at the time of the buyout. HSBC provided debt to support the transaction.

Company
Solihull-based UKDN was founded in 2003. It provides claims management, remediation, validation, investigation and repair services for UK-based household insurers. The business had a £20m turnover at the time of Lyceum's investment.

Waterflow specialises in providing CCTV inspection, maintenance, renovation and repair of drains and sewers in safety and time critical environments. Its clients list includes Thames Water, Anglian Water, Network Rail, London Underground, The Highways Agency and Balfour Beatty. The Slough-based company was founded in 1965.

People
Lyceum was represented by Martin Wygas and Simon Hitchcock. Greg Beech is CEO of UKDN.

Advisers
Equity & company – Cobetts, Graham Muth, Mark Canning (Legal); BDO, Roger Buckley, Adam Whistance (Corporate finance); Graham Elsworth, Dougal Baxter (Financial due diligence); CIL, Martin Bean (Commercial due diligence); Aon, Peter Casciani (Insurance due diligence); Savills, Phil Austin, Paul Higman (Property due diligence).