LDC sells SRL Traffic Systems to 3i Infrastructure

3i invested a further GBP 83m in debt financing, intending to replace this with a third party debt in the future.

SRL increased its revenues from GBP 18.4m in 2019 to GBP 31.6m in its current financial year.

The exit will generate a 5.7x money multiple for LDC on its original investment and an IRR of 124%.

Back in September 2019, LDC invested GBP 24m in the management buyout of SRL. Co-investor Crescent Capital Group invested via Crescent European Specialty Lending fund and also provided unitranche financing for the acquisition. Its fund closed on EUR 650m in 2015, according to Unquote Data.

During the investment, SRL increased its fleet from 7,500 systems to nearly 13,000, increased its headcount form 140 to 182 and added four new depots. SRL also hired a new CFO, chief operating officer and chief information officer.

The company was reportedly marketed based on EBITDA of around GBP 8.5m, according to Debtwire. The buyout was led by SRL's CEO, Richard Tredwin, and his management team.

Company
SRL is a Cheshire-headquartered manufacturer of portable pedestrian and traffic light systems. It was founded in 1997. It is the UK's only manufacturer to sell and hire traffic light equipment.

People
SRL Traffic Systems – Richard Tredwin (CEO).
3i Infrastructure – Richard Laing (chairman); Phil White (managing partner and head of infrastructure).
LDC – John Clarke (investment director in the North West).

Advisers
Equity – DC Advisory (corporate finance)

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• Topics
• Exits
• United Kingdom
• LDC
• 3i