15 December 2014
Cussins, a house builder based in the North East, received a £5m investment from BGF in December 2014. The money is being used to support the acquisition of land and the development of up to 300 new houses per year over the next four years, generating 500 jobs.
Peter Cussins, executive chairman, and his son Jabin, chief executive, remain majority shareholders in the Alnwick-headquartered business. For almost a century, three generations of the Cussins family have built more than 50,000 houses in landmark developments across the North East.
After a prolonged period of housing shortage in the North East, the Government’s revised planning framework is helping Cussins take advantage of an increased availability of high quality land in prime locations. With a strong emphasis on housing design that complements local surroundings, the business focuses on smaller developments of between 10 and 70 homes, where there is a high level of demand from buyers.
To support business growth, Cussins appointed Mike Stansfield, former chief executive of David Wilson Homes, as non-executive chairman. Stansfield was introduced to Peter and Jabin Cussins by BGF. Richard Taylor, investment director at BGF, also joined the board. As part of the investment, the business secured a £7m debt facility from Lloyds Bank Commercial Banking, whom it has banked with for over 40 years.
BGF has invested £7.5m growth capital in J&B Recycling, a waste recycling company.
Operating from two recycling facilities in Hartlepool and a waste transfer station in Middlesbrough, J&B Recycling provides waste collection, recovery and recycling services to both public and private sector organisations throughout the North East. Customers include local authorities, housing authorities, commercial, industrial and also other waste companies who use J&B’s facilities to recycle their customers’ wastes. J&B Recycling diverts waste away from landfill by increasing the levels and types that can be recycled and reduces the cost of waste removal for its customers.
J&B Recycling operates in a sector that is subject to strong regulatory growth drivers. Current EU and UK government policy aims to divert as much waste as possible away from costly and capacity-constrained landfill sites, into recycling and recovery.
The company is run by female entrepreneur Vikki Jackson-Smith, who established the recycling business in 2000 to diversify from the solid fuels business that her father Alan Jackson had originally established in the 1970s. Since then, the business has grown to an annual turnover of c. £10m and employs 175 people.
BGF’s growth capital will enable the company to develop an additional recycling facility in Middlesbrough for treating commercial waste, as well supporting further expansion at existing facilities where household waste is treated. Following the investment, non-executive director Ross Smith took on the role of non-executive chairman. Ross was formerly CEO of 3i backed MDC Technology and chairman of CSL Dualcom.
MODA IN PELLE
BGF has invested £3.5m growth capital in Moda in Pelle, a designer and retailer of women’s footwear headquartered in Leeds, with nearly 60 stores and concessions across the UK.
Following a successful 12 months and with year-end revenues expected to be close to £20m, Moda in Pelle has extended its management team and will implement a strategy for further growth using BGF’s investment. The new capital will be used to accelerate the roll-out of stores across the UK and internationally, as well as enhance the in-store customer experience and support further development of the company’s website and other e-commerce channels. While continuing to focus on quality and affordable luxury, a brand refresh will be unveiled in autumn 2015.
Stephen and Claire Buck – who have been instrumental in growing the business into a national boutique brand of women’s footwear – will remain majority shareholders. Stephen has been at the helm of Moda in Pelle since he founded the company in the mid-1970s with a single store in Leeds.
To implement the growth plan, David Inglis, who has previously advised Moda in Pelle, will join as chief executive and invest alongside BGF. Judith Pilkington – introduced through BGF’s talent network – has also been appointed to the board as non-executive chairman.
David previously held senior roles at Asda and Shop Direct, while Judith is former chief executive of Space NK and has worked at Fenwicks, Selfridges, Harrods and Mappin & Webb.
BGF will take a minority stake and BGF investment director Richard Taylor will join the board as a non-executive director. As part of the investment, the company has also secured an increased working capital facility from Lloyds Bank. The Lloyds team was led by Matt Pollard and Alison Hoyle.
Stephen Buck, founder, Moda in Pelle said:
“Over the past 40 years, we’ve created a tremendous amount of brand capital among a loyal customer base by focusing on quality design and manufacturing. After a particularly strong period of growth, we want to pursue new opportunities to fully exploit the brand’s potential. David has an acute understanding of what we want to achieve, and brings with him energy, determination and strong background in the retail sector. I’m delighted that he will be joining the team.”
David Inglis, chief executive, Moda in Pelle commented:
“We have ambitious goals for Moda in Pelle. Developing our multi-channel offering will be a primary focus over the next 12 months, and we will continue to explore new opportunities with wholesale and internationally.
“The investment from BGF, alongside an increased facility from Lloyds Bank, provides us with the capital to implement our plan. We are excited about the future of the business and recognise that securing the right long-term funding partner is a key step.”
Richard Taylor, investment director, BGF commented:
“We’re backing Moda in Pelle because of the strength and capabilities of its management team and the growth potential of the business. We’ve been impressed by management’s clear strategy for the company, knowledge of the retail sector and understanding of the Moda in Pelle customer.
“Since opening the BGF office in Leeds, we’ve met many diverse businesses with ambitions to grow. Importantly, we only ever take a minority stake which means that the management teams we support – like Moda – are assured that they will keep control of their businesses.”
Springfield Healthcare opens supported living home in Hartlepool
Care provider Springfield Healthcare has opened a new £800,000 supported living development in Hartlepool, a unique concept designed to enable young adults with learning difficulties to live independently in the community.
The ‘Pathways to Independence, Independent Supported Living Scheme’ facility comprises five, two-bedroom apartments and a further single bedroom apartment, along with a ground floor drop-in centre with a TV area and kitchen facilities, and staff available 24-hours a day. Located close to shops and amenities, it provides a halfway step for young people, preparing them for living independently in the community. The property, the historic Co-operative building on Park Road, is Grade II listed.
The project was backed by growth capital provider, BGF (Business Growth Fund). The funding follows BGF’s initial injection of £4.4 million into two businesses within the Springfield Healthcare Group in 2012: Springfield Homecare and Seacroft Care Village.
BGF is the UK’s leading independent investor of growth capital in UK smaller and medium sized businesses, and is backed by five of the UK’s main banking groups. The company provides long-term equity investment in return for a minority equity stake.
Springfield Healthcare Group, was founded in 1967 and today is one of the largest independent providers of domiciliary care in Yorkshire and Humberside. The business, which began as a specialist provider of dementia care, has expanded in recent years to provide general homecare and training for other care providers. Springfield has also pioneered the care village model. This saw the company open Seacroft, a £5 million development in Leeds last year. Across the Group, Springfield now employs 1,200 staff and provides care to 2,500 people each day.
Graeme Lee, CEO of Springfield Healthcare Group, said: “Our ethos is to keep people living at home independently for as long as possible. The facility offers disabled young adults the freedom to choose their path, while benefiting from comprehensive, market-leading care and support. These young people now have the opportunity to live independently within the community, with their families reassured by the 24/7 care and support that they will receive.
He continued: “Springfield Healthcare has seen exceptional growth during the past two years, and the support that we have received from BGF, both financially and strategically, has contributed significantly. We look forward to the further growth of the business during the coming months, continuing to provide the very best care to our clients.”
Andy Gregory, Regional Director at Business Growth Fund (BGF), said: “Springfield Healthcare continues to lead the market, providing the highest quality care in exceptional facilities. BGF is pleased to have been able to assist the business in delivering its latest facility, and look forward to working with Springfield Healthcare as it continues to expand both its properties and service provision.”
Richard Hunt and Jeremy Thompson of Squire Patton Boggs acted as legal advisers to BGF on its investment in Springfield Healthcare.
BGF in £5.6m follow on funding
In May 2014, BGF announced investments totalling £5.6m, of follow-on capital, into two investee businesses: award-winning Mexican street food chain, Barburrito (£3.6m) and budget gym chain, Xercise4Less (£2m).
BGF retained a minority stake in each of these businesses following the investments.
John Swarbrick, BGF’s Head of Portfolio, commented:
“We are an investor of just three years standing and the majority of our investments are still less than 18 months old. However, we are already seeing many encouraging signs of growth across the portfolio of companies that we have backed. This sort of sustained growth often requires the provision of further funding and the ability to provide this forms a critical element of BGF’s offer.”
Morgan Davies, MD and founder of Barburrito, said of the additional funding:
“We started this great burrito race in the UK and as I have always said, this is more than a business…it’s a passion. The further funding provided by BGF is a great step forward for our business. It offers us a vote of confidence and most importantly, the funds with which to continue to take the business forward.”
Since BGF backed Barburrito with an initial investment of £3.25m in March 2012, it has opened three new restaurants across London and additional sites in Leeds and Nottingham; and has established its position as the UK’s first burrito bar with a national presence. Its existing sites have also continued to experience strong like for like sales growth. The company’s turnover has doubled over the past year alone with a net sales run rate of over £8m, and it now employs 200 people nationwide.
Following this latest investment, Graham Turner the former CEO of the Tragus Group (the UK’s largest independent restaurant companies with more than 290 sites across the country) has joined the board of Barburrito as a Non-Executive Chairman. This introduction was made via BGF’s Talent Network.
Leeds based low cost gym chain, Xercise4Less, which received a £5m investment from BGF in August 2013, is also performing strongly and is on track to secure a further 11 sites this year, bringing its total to 29 gyms located across the country.
BGF-backed Springfield completes Seacroft Grange care village creating 100 jobs
Seacroft Grange care village in Leeds has been completed following a five year renovation project and a £1.9m investment from BGF.
The new care village will create 100 new jobs and transform a once dilapidated historic building overlooking an ancient village green into a new care complex.
The funding formed part of BGF’s overall £4.4m investment in Seacroft Grange owners Springfield Healthcare Group.
The care village offers services including day care, residential and nursing care, as well as private independent living apartments for a wide range of age groups.
The building dates back to 1627 and had been prominent within the local community for many years. For 30 years until the mid-1970s it operated as Seacroft primary school and many of the local residents who attended the school during those years still live locally and will benefit greatly from the services offered and have been great advocates of the project.
Chief executive Graeme Lee said: “Our model helps families make an informed choice earlier in the planning process and then moves with the needs of individuals or couples as their care needs progress, at the same time ensuring long-term consistency where the care team and quality of information are concerned. At the heart of our care village is a Grade II listed building which will be the basis for all our social and community activities and houses a cinema, therapy spa and gym, hair salon and coffee shop that wouldn’t look out of place on the high streets of York or Harrogate.
“As well as exceptional views over the village green, which is mentioned in the Domesday Book, people and families can be seen going about their daily business and, unusually, we have every single community amenity including medical centres, pharmacy, pub, library, church, post office, supermarket and bus station, all within 100 metres.”
Springfield Healthcare Group is the largest independent provider of domiciliary care in Yorkshire and Humberside. It provides care to nearly 2,000 clients each day and employs over 600 people locally.