UK - Gresham takes five of Formation's businesses private in £20.75m MBO

Deborah
30 July 2009

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Gresham Private Equity has backed the management buyout of five of AIM-listed Formation Group's nine businesses, in a deal valued at ТЃ20.75m, creating the newco of James Grant Group (JGG) Limited.

Gresham has provided the entire sum of the funding to complete the transaction, using its recently launched debt underwriting product. The 10-strong management team of JGG, headed by chief executive Neil Rodford, has also committed to investing in the new company.

The five businesses that are included in the transaction provide management and professional services to the sports, music and entertainment sectors. They are James Grant Media; O J Kilkenny & Co.; Proactive Sports Management USA; Formation Sports Capital; and Proactive Sports Management Ltd. Clients of the businesses include Ant & Dec, Bryan Adams, Lily Allen and Sir Bob Geldof.

JGG will trade with two divisions. The management services division will trade under James Grant, while professional services will adopt the name of O J K. For the year ending 31 August 2008, the five businesses generated combined revenues of approximately £10m.

Gresham's strategy to grow JGG is focused on selective acquisition, organic development, and the diversification of services the companies provide. Andy Marsh and Ken Lawrence of Gresham will join the board of the newco.

The four remaining businesses of Formation will remain part of the AIM-listed entity. The completion of the deal is still subject to shareholder approval.