LDC, the leading mid-market private equity firm, invested £437million of equity last year in 23 new deals, a record total for the business, driven by continuing demand for private equity from the UK’s medium-sized businesses.
In an annual summary of its performance, LDC – which typically invests between £5million and £100million in a single transaction – said every one of its seven UK regional teams invested last year. The firm is committed to investing £1.2billion in ambitious high-growth firms over the next three years (2019-2021).
In Wales, LDC invested in the award-winning outdoor adventure business which features the world’s fastest zip line, Zip World, in a deal which valued the business at £45million. The transaction will support Zip World’s ongoing growth strategy as it looks to add new attractions to its current sites and rollout its adventure experiences across the UK and beyond.
On LDC’s exits across the UK, the firm said it had worked closely with management teams throughout 2018 to take advantage of favourable selling conditions with 26 divestments. Total proceeds generated reached £1billion with an average money multiple of 2.7 times.
Looking ahead, LDC said it expects a challenging period across the market as uncertainty continues, but LDC confirmed its appetite to invest remained as strong as ever.
Dewi Hughes, Investment Director and Head of LDC in Cardiff said:
“Wales is home to a wealth of successful business, including a number of undiscovered gems. Our role is to ensure management teams here have access to the capital and expertise to help them thrive and drive their ambition forward.
“We’re committed to backing entrepreneurial management teams to fulfil their potential. As a result, we’re investing £1.2billion of equity in Britain’s small and medium-sized businesses over the next three years, which our team in Wales will play a key role in.”
Alongside its investment and exit performance, LDC also provided a national summary of its portfolio impact from 2018, confirming that companies it sold during 2018 had increased their enterprise value by an average of 138% during its partnership, grown sales by 79% and profit by 45%. Together, these 26 companies added a total of 2,784 roles to their teams, and with LDC’s support expanded into more than 25 countries and developed 50 new products or services.
Martin Draper, CEO of LDC, added: “Last year was another milestone year for LDC, which saw us deploy our capital and expertise from every one of our regional teams. The outcomes achieved not only demonstrate the success of our unique, value-driving model, but also the importance of having a presence on the ground to create enduring partnerships that enable companies across Wales to thrive.”
LDC, which has now invested in over 600 firms since it was established, said it remained committed to its three-year investment pledge of £1.2billion for 2019-2021.