In December 2010, we secured the management buyout of Chemigraphic, one of the largest independent full service electronic manufacturing services providers in the UK, by undertaking to underwrite the deal consideration in full at completion.
We structured the deal in this way to provide certainty of delivery for the vendors and to give Chemigraphic the benefit of being able to negotiate the best possible debt financing package to support the company going forward.
The Crawley-based business was founded in 1972 by Frank and Julia Graham, a husband and wife team, who held the respective roles of CEO and FD and who retired on sale. The buyout was led by their sons, Paul and Neil Graham, who between them have worked in the business for over 29 years, together with an experienced buy-in CEO, who worked with Paul and Neil to plan the future strategy of the business in the six months leading up to the deal.
We have a successful track record of supporting buyouts of family businesses and experience of partnering with the next generation as part of our investment approach. These attributes, combined with our ability to be decisive and flexible in structuring the deal in order to ensure delivery in a tight timeframe, were crucial in winning the mandate. We were impressed by Chemigraphic’s excellent foundation of strong, long-standing customer relationships and its reputation for service and quality, as well as by the experience and ambition of the management team and its continuous growth in revenue and profitability over a number of years.
Operating from a 40,000 square foot purpose built office and factory complex, Chemigraphic designs, assembles and installs complex printed circuit board based components and provides a number of related services including design, full assembly & testing and final delivery. The company has achieved consistent growth by offering a highly flexible and reactive full service and now employs over 125 staff.
Chemigraphic has continued to perform strongly since the buyout and, as a result, received several competing indicative financing offers despite the difficult debt market. HSBC were selected to provide the new debt facilities and the refinancing was completed in May 2011.
We introduced the Chemigraphic team to Mark Weavis, who was appointed as chairman. Mark is an Operating Consultant to RJD and is also currently chairman of our portfolio company Stone Group. He was formerly managing director of another RJD backed business, Teaching Personnel, a leading provider of supply teachers.
Mark’s experience of building a highly successful service-led business will be of considerable benefit to Chemigraphic and we believe he will add significant strategic value to the board as the company grows into an increasingly important player in the UK specialist electronics sector.
To discuss Chemigraphic in more detail, please contact Richard Caston.