BHR Group, the independent research and technology organisation specialising in the application of fluid engineering to industrial processes, is preparing for expansion thanks to a £2.6m investment of growth capital from BGF.
BHR grew out of the British Hydromechanics Research Association, one of the founding research associations established by the UK government in the 1940’s alongside the likes of MIRA and PERA. Current Managing Director Raghbir Chand took control of Cranfield University-based BHR in August 2011 and revenues have grown year on year since. BHR currently employs 84 staff; a mixture of scientists, engineers and commercial staff.
BHR has a well-established heritage, and is recognised globally for its engineering excellence and contribution to fluid dynamics, with a diverse cross-section of clients across multiple industries including Shell, DOW Chemical, Mott McDonald and Sellafield.
Projects range across the fluid mechanics sector, from processes involving the effective mixture of nano-fluids, to new product development and validation of advanced and high value engineering systems. BHR also offers integrated design, consultancy and project management solutions, such as city-wide integrated intelligent smart water systems design. BHR has clients operating in the renewables, oil and gas, chemicals, nuclear, water, power, and manufacturing sectors where fluid behaviour is critical to design performance and operational costs.
BGF’s investment in BHR will be used to grow the company’s core consultancy offering, as well as to support additional research and development, and the commercialisation of its own intellectual property and know-how. The new capital will also allow BHR to consolidate and expand into new markets, such as the Middle East where it’s knowhow and expertise is in great demand and key clients seek local presence for larger contracts and joint program deliveries.
BHR will also bolster its Board with the appointment of Michael Stevens as Chairman and Paul Winstanley as Non-Executive Director. Michael was formerly Chief Executive of Linx Printing Technologies, and currently serves on boards of Hydro International plc and Stratophase Ltd. Paul is the former President and CEO of QinetiQ’s USA presence, and is currently serving on the board of several early stage ventures including Alazen Ltd and Entrada Ltd.
BGF has taken a minority stake in BHR and Senior Investment Manager, Jonathan Earl has joined the board, supported by Aaron Baker who will act as Observer.
Raghbir Chand, Managing Director of BHR, said:
“Research and technology organisations such as BHR Group play a pivotal role in taking scientific knowledge and applying this to develop new or improved engineering products and processes. BHR has enjoyed significant growth since 2011 and I am incredibly proud of the level of expertise, high commitment and calibre of the team that we inherited, and have continued to build in a relatively short time.
“We have been seeking a long-term strategic partner that is able to not only offer the capital investment that we need to deliver the identified growth opportunities but also understands BHR’s history of innovation and shares our passion for supporting our loyal and increasingly international client base. This investment from BGF will allow us to rapidly modernise the existing facility at Cranfield, invest in additional state of the art equipment and widen the already broad offering of services that we offer our customers. It will also accelerate the bringing to market of BHR’s owned product opportunities, including the launch of the ‘BHR COOLFIRE’ product portfolio (high pressure engineering cutting and jetting systems) for the fire and rescue services.”
Jonathan Earl, BGF’s Senior Investment Manager, said:
“We have been very impressed with what Raghbir and the team has achieved to date. BHR has a solid underlying business capable of continued growth, as well as significant IP which the company has started to commercialise. The quality of service that it provides helps other businesses to maximise their investment across a huge array of sectors and applications and being the market leader, BHR is well placed to expand its presence in the field of fluid engineering.”
Ninth generation family business partners with BGF
BGF tailors its offer to support family’s long-term plans for hereditary business
BGF has invested £3m in Dudson (Holdings) Limited (“Dudson”), one of the UK’s oldest family-owned businesses that produces ceramic tableware for the travel and hospitality industry . Operating since 1800, Dudson is currently under the stewardship of 8th generation family members Ian, Max and Mark Dudson who act as Non-Executive Chairman, CEO and Group Operations Director respectively. The 9th generation is already represented by Ian’s daughter, Katie, who is the company’s Marketing Manager. The business is headquartered in Stoke-on-Trent and employs over 500 people, with turnover approaching £30m.
Dudson supplies the travel and hospitality industry with high quality durable tableware, which it manufactures at its factories in Stoke-on-Trent and Digoin, France. Dudson acquired its fully automated French manufacturing facility in 2009 and also owns a stake in Furlong Mills, a Stoke-on-Trent clay materials supplier. It sells to customers globally from its six international commercial centres, as well as through a range of distributors and agents in countries throughout the world. Customers include Virgin Rail, Pizza Hut, Virgin Atlantic, Nandos, Princess Cruises, Hilton & Hyatt Hotels.
BGF has provided £3m of long term capital to allow the family to invest in the business, whilst retaining the flexibility to pass the company onto the next generation. The funding will enable Dudson to invest in more efficient manufacturing equipment, streamline production processes at its manufacturing facilities and enhance its sales and marketing capabilities.
This investment comes one month after BGF’s £2.8m investment in another Midlands based family business, Rutland Cycling.
Ian Downing, Investment Director at BGF who joined the company’s board, commented:
“Dudson has an impressive 200-year track record and has carved out a strong niche position in the international market for hospitality tableware. It is a great example of a British manufacturing business that has invested heavily in product and process innovation and successfully taken it products into an international marketplace.
“The company’s board has now identified a clear strategy to develop and grow the business, with the objective of being able to pass on a larger, stronger organisation to future generations. We look forward to bringing both financial and strategic support to the table and to working with the team to deliver on their ambitions.”
Gavin Petken, Regional Director, added:
“This investment is a great example of how BGF can offer flexibility in the way that it structures investment – to best meet the needs of shareholders and put the company on the strongest course of growth. Dudson’s motivation is to invest in the business so it is in the best possible shape for future generations, and the long-term strategy to deliver growth will provide new job opportunities both in Stoke-on-Trent and across its global operations. Our capital is long term, unsecured, and flexible; and there is no pressure for the business to move outside of family control.
We believe this is an approach that will resonate with many family businesses. With the right partner on board, these businesses have a great opportunity to achieve their ambitions, to outperform their competitors and to secure long-term financial security for future generations.”
Max Dudson, CEO of the company is delighted with the new partnership and BGF’s approach to the investment.
“Having been through a restructure we have a clearly identified strategy for growth which requires capital investment to deliver improvements in manufacturing efficiency, new machinery to support growing product categories and further investment to support the expansion of our sales, marketing and design teams to exploit new and developing market opportunities. We were keen to find a partner who had the foresight to invest in our strategy as a supportive partner who could add commercial value to our business as well as inject required capital. BGF’s modus operandi of providing unsecured capital and allowing the incumbent board of directors to retain full control of the business, coupled with their long term perspective, makes this a perfect partnership for Dudson, allowing us to deliver our strategy for growth.”
In December 2013, BGF invested £4m of growth capital in Palmer Hargreaves, a marketing and communications agency headquartered in Leamington Spa, with additional operations in China, Germany and Russia.
Palmer Hargreaves was established in 1984 by the current Chairman Andrew Clift, leveraging his strong relationship with Ford for whom he previously worked in sales and marketing. The company grew through a focus on the automotive aftersales market where it established itself as the European market leader and it has diversified in recent years to cover other sectors including agrichemicals, financial services and B2B services.
Palmer Hargreaves focuses on large organisations with complex marketing needs and multi-national/multi-lingual deployment requirements. Clients include Ford, Bayer, Mercedes Benz, Jaguar Land Rover, General Motors, Audi, Volkswagen, Mazda, Continental Tyres and BMW.
The company employs nearly 50 people at its offices in Leamington Spa.
BGF’s £4m growth capital investment is supporting the company’s acquisition-led growth. Palmer Hargreaves completed the acquisition of German IT and telecommunications communications business PR Partners in October 2013, expanding its range of complementary services and clients. BGF’s investment is providing growth capital for acquisitions in the UK and Germany and has enabled the business to expand its international presence, opening a new office in Shanghai in December 2014. Palmer Hargreaves was then appointed as Porsche China’s lead Aftersales Marketing & Communications Agency under a two-year contract, with a number of significant projects underway.
The new office is based in the heart of Shanghai and has now appointed Coaching and Consultancy Director, Mark O’Flaherty.
Mark, is based locally, has 20 years’ experience in Global Automotive Aftersales across over 15 vehicle manufacturer brands, including Fiat, Ford, Volvo, JLR, BMW,
Aaron joined the BGF Midlands team in 2013 and is involved in all aspects of the investment process. Responsibilities range from investment origination, transaction execution, as well as working with management teams of investee companies.
Before joining BGF, Aaron was an associate director in the Structured Finance team at RBS, providing structured debt solutions for both financial sponsor backed transactions and complex corporate structures. Prior to this, he spent three years at Deloitte in London, within the Private Equity Transaction Services team. Aaron holds a First Class BSc degree in Engineering & Business Studies from Warwick University (2007) and is an ICAEW Chartered Accountant.
He is a keen sportsman, regularly playing cricket and golf, and lives in Leamington Spa with his wife and young daughter.
“BGF has proven its ability to support the growth of UK small and mid-sized companies but we can still do much more. It is truly rewarding, and incredibly enjoyable, to be a part of this story, meet such a wide variety of businesses, and enable entrepreneurs to fulfill their growth aspirations.”
- MPK Garages (Board Observer)
- Solid Solutions (Board Observer)
- Hawk Group (Board Observer)
- Dudson (Board Observer)
- Paintbox Group (Board Observer)
- Environmental Essentials (Board Observer)
- Shepherd Direct
- BHR Group
- Palmer Hargreaves