Spectrum advises on the MBO of Mountain Warehouse Group
Spectrum Corporate Finance has advised the management team on the £85m MBO of Mountain Warehouse Group from Lloyds Development Capital. In addition to supporting the management team through the process, Spectrum successfully led the arranging and structuring of new senior and mezzanine debt facilities of over £50m to finance the buy-out and support the company’s on-going growth strategy.
Based in London, Mountain Warehouse is a leading specialist travel and outdoor retailer selling an exclusive range of own brand equipment for hiking, camping, skiing and many other outdoor pursuits for all the family. Mountain Warehouse was first established in 1997 by its Managing Director, Mark Neale, with the support of private equity investment since which time the business has grown to a current base of 172 stores and a strong on-line offering with 17 current channels. Unlike many of its competitors, all of the product Mountain Warehouse sells is exclusive to the company and designed to exacting and consistent standards, enabling the business to sell top quality product at highly competitive, value for money, prices.
Mountain Warehouse has benefited from the support of a series of private equity investors since inception, but it has always been Mark Neale’s vision to attain full ownership of the business for the management team. Lloyds Development Capital acquired a minority equity holding in Mountain Warehouse in 2010 to help support the buy-out of the company’s previous private equity investor. On the back of continued strong trading results in recent years, the opportunity arose to acquire the Lloyds Development Capital shareholding via a debt funded MBO. The Mountain Warehouse management team approached Spectrum to support them in this process and to lead the new debt raising process. Working closely with management Spectrum undertook a detailed business analysis and presentation exercise that generated strong interest from a number of banks and debt funds in a competitive process. The deal was successfully concluded with the company’s existing bankers, The Royal Bank of Scotland, providing senior debt and working capital facilities and additional mezzanine debt from Alcentra.
“We were very pleased with the service and hands on support provided by Spectrum who played a pivotal role in many stages of the transaction and were instrumental in the successful completion of our deal. Spectrum showed an excellent awareness of the challenges involved in the process allied to a deep knowledge and understanding of the debt markets. They were able to introduce us to exactly the right debt providers and ensure that information was presented to them in a way that met their requirements, adding value at every step of the process and operating as a fully integrated member of our team. As a result we were able to secure an extremely competitive and flexibly structured debt package that exceeded expectations and enabled us to take full ownership of the business. We have been impressed by Spectrum and commend them highly.”Mark Neale, Managing Director, Mountain Warehouse Group
“Mountain Warehouse is a great business which was looking for a solution to move away from private equity and we were delighted to help provide this. We are very pleased that Spectrum introduced us to this opportunity and the service they provided was excellent. Ian remained commercial at all stages of the transaction and was instrumental in the successful completion of the deal. His deep understanding of the LBO markets and hands-on approach made the process smooth and efficient.”Natalia Tsitoura of Alcentra Limited