BGF builds investment record in improving construction sector with £2.5m provided to leading specialist interiors subcontractor
In June 2014, BGF made its first investment in a South Yorkshire based business with £2.5m provided to leading specialist interiors subcontractor Horbury Group. At the point in time, BGF had invested c. £30m in the county to date via its Leeds and Manchester based local investment teams.
This was also the third investment that BGF had made in businesses growing in the wake of an improving construction market. In May 2014, BGF invested £10m of growth capital in TCL Holdings Ltd, an external property services business; and in 2012, it backed high specification scaffolding services specialist, SHS Integrated Services with £5.4m of growth capital.
Headquartered in Rotherham, Horbury Group was founded in 1993 by current Group Managing Director Trevor Wragg as a specialist subcontractor for the construction industry. It comprises three principle subsidiaries; Horbury Building Systems, Titan Interior Solutions, and MWS Joinery, and has a combined turnover in excess of £50m and a workforce of 800 people. Headquartered in Rotherham, Yorkshire, Horbury Group also has offices in London and South Wales.
The company provides internal fit out services including partitioning, ceilings, joinery and flooring to major construction companies including Carillion, Balfour Beatty, Kier, and Shepherd Construction. It has successfully installed a range of products and internal structures to public and private buildings that include student accommodation, apartment, hotels, schools, hospitals and major retail and leisure developments. Projects include the Queen Elizabeth Hospital, Birmingham; Liverpool Library; the Business School at Manchester Metropolitan University, Reading Railway Station; and Park Hotel in Nottingham.
With the UK construction market showing positive signs of growth, BGF’s investment will enable Horbury to tender for larger, and a greater quantity of, projects. As a result of the investment, the company expects to significantly increase its workforce in the year ahead.
Trevor Wragg, founder and Group Managing Director of Horbury, commented:
“This is great news for the company and everyone associated with it. This funding means that we can act on growth opportunities that we have identified as part of a recent strategic review of our business and market. Our core trades are seeing demand as the construction industry is returning to growth. Last year we opened two new offices in the South West and in Central London primarily to improve our service to clients in these areas. This investment has paid off, and contributed to the strong growth we achieved over the last 2 years throughout England and Wales. It’s great to know that the enthusiasm and confidence we have for the business and the future is shared by our backers.”
Andy Gregory, BGF’s Regional Director for the North of England, commented:
“Horbury Group is one of a small number of businesses in its sector with the size and scale needed to operate nationally; and as the recovery of the construction industry continues, it is well placed to take advantage of a growing pipeline of work.
“It is one of several businesses that we have backed which are acting on exciting growth opportunities generated by an improving UK construction sector. This is exactly where BGF’s growth capital is intended to help – enabling businesses to capitalise on opportunities that they might otherwise be unable to take full advantage of.”
BGF pipes £3m into drainage contractor to accelerate growth
In June 2014, BGF announced a growth capital investment of £3m in Flowline Limited, a leading drainage contractor in the South East of England.
The £3m investment for a minority stake in Flowline, enabled the business to acquire Clearaway Drainage Services Limited, provide capital to support organic growth, strengthen the senior management team and train staff to deliver new services and operate in new markets. The acquisition of Clearaway adds expertise in the rail and industrial markets.
Flowline was founded in 1991 by Managing Director Barry Robins and since then, the business has grown revenues to over £8m in the year ending July 2014. The company operates from its head office in Rayleigh, Essex with satellite sites near Reigate, Surrey and South Mimms, Hertfordshire. The Company currently employs 85 staff.
Flowline is a commercial drainage contractor providing CCTV pipeline surveying, high pressure water jetting, gully and catchpit cleaning, waste recycling, liquid waste tankering and road sweeping primarily into the water and highways markets. It currently runs a fleet of 60 vehicles serving customers across London, the Home Counties and nationally when required. Customers include infrastructure owners such as Thames Water and Anglian Water. Clearaway was established in 1994 and is based in Kings Langley, Hertfordshire. The acquisition adds expertise and a strong track record in two new markets; rail and industrial, and skills in two additional technically complex service lines in relining and robotic cutting.
In addition, at the introduction of BGF, Alan Horton, the former CEO of Evander Glazing & Locks, joined the Flowline board as Non-Executive Chairman and Investment Director Rory Pope joined the board as BGF’s representative.
Barry Robins, Managing Director and founder of Flowline, said:
“Having built up a profitable and highly regarded business in the sector, I am convinced that now is the time to take advantage of a capital injection and combine it with our experience to grow the business faster and further. The investment will allow us to build our fleet and equipment, make value enhancing acquisitions and recruit additional experience into the business. I look forward to working with BGF as a partner to achieve these goals.”
BGF Investment Director, Rory Pope, said:
“This is an exciting opportunity to back a well-established business operating in a robust sector. Flowline has a clear growth strategy based on continuing to win new contracts for its existing services, and expansion into new markets where substantial opportunities exist such as rail and industrial, supported by the strategic acquisition of Clearaway. We are looking forward to partnering with Barry and the management team to drive the business forward and capitalise on the opportunities that exist for them.”