Acquisitions

Regulated Services

Our investment focus is on B2B service sectors where businesses provide services which are essential or mandatory, invariably subject to regulation and characterised by consistency in demand.

Recurring Revenues

We focus on targets that have a large proportion of revenues that recur periodically from month to month and year to year with long-term, durable customer relationships.

Operational Complexity

We focus on service sectors which are technical, specialist and operationally complex to deliver and command attractive margins thanks to the efficiencies and value they add to our customers’ operations.

Economies of Scale

We favour service sectors in which scale can present the opportunity to generate enhanced efficiencies for our customers and returns for our shareholders, and those in which larger, national operators generate pricing power and possess a competitive advantage in winning and delivering business.

Strategic Fit

We will continue to build our Group upon businesses which fit well together and share a similar channel to market along with complementary operational methodologies. This provides our businesses with an intrinsic advantage of being able to share customer relationships across the Group and to implement well-rehearsed operational improvement initiatives.

Fragmented Markets

We focus on markets which are fragmented and exhibit characteristics that are suited to industry consolidation

We would like to hear from you if you are/are selling a UK focused business with revenues in excess of £0.5m and are:

• Planning a retirement sale, complete or partial exit from your business.
• An ambitious entrepreneur or management team of an established businesses operating in the UK business services arena looking for significant investment to accelerate your growth.
• In a strong market position regionally or nationally with established operations.

We can offer:

• The opportunity for both operational improvements and the economies of scale that are created through joining our group
• The benefit of being part of a listed company which provides access to significant investment and the flexibility to take advantage of further growth opportunities
• We have significant acquisition funds readily available
• We are able to structure a wide variety of deals to suit diverse shareholder circumstances and don’t have a one size fits all approach. Our in house team of M&A professionals are adept at structuring deals end executing them efficiently.
• The ability to complete deals of all shapes and sizes, but typically with enterprise values that range from £0.2m to £50m.

Acquisition of William Martin (Dec 2018):

Acquired for an implied enterprise value of £30m. Formed in 2004, William Martin is a leading technology-enabled UK provider of property-related health and safety audit and consultancy services. It provides consultancy to a range of commercial customers across the UK in areas such as H&S, fire safety, water safety and asbestos management.

How we add value:

Since the acquisition we have been working with the management team of William Martin to develop its market leading position through:

• Further investments in its leading proprietary risk management software, Meridian
• Further investments in organic growth and a focus on cross-selling its services to other Marlowe customers
• Further bolt-on acquisitions to add scale and capabilities to the business
• View the RNS on the Acquisition of William Martin

Acquisiton of Suez WCS (Aug 2018)

Acquired for an enterprise value of £4.5m. Founded in 1977 and employing approx. 170 staff, Suez WCS operates nationally from its headquarters in Daventry and provides water treatment and hygiene services across a broad range of sectors. In addition, the business produces certain chemicals used in water treatment applications.

• For the year to 31 December 2017, Suez WCS generated unaudited pro forma revenues of £13.2 million.

How we add value:

Since the acquisition we have been working to integrate Suez WCS into our Water division to take advantage of the synergies between the two businesses. Quick decision making, clear direction and an intimate knowledge of the water treatment market have led to significant operational and revenue synergies being realised in a short period of time. Investments in organic growth, improved chemical blending facilities and significant improvements to the businesses technology, systems and processes have all led to improvements.

Additionally, since the acquisition, we have divested a small, non-core part of the business generating revenues of £0.6m to one of its customers for an EV of £2.3m

View the RNS on the Acquisition of Suez WCS Limited

Acquisition of Tersus (Oct 2018)

Acquired for an enterprise value of £3.7m. Formed in 1986, Tersus provides testing and inspection services to a wide range of clients in both the private and public sectors, mainly focused on managing the risk of asbestos. Tersus, which employs approx. 180 staff, is headquartered in Rainham, Essex, and operates nationally from eight sites, each with its own laboratory.

Tersus generated revenues of £8.1 million.

How we add value:

Since the acquisition we have been working closely with the management team of Tersus to grow the business:

• by cross-selling across other Marlowe companies, particularly with our other Air Quality activities which share very close synergies with Tersus
• through further investments in organic growth
• improvements in technology
• through investments in new management appointments
• by developing a pipeline of potential bolt-on acquisition opportunities
• View the RNS on the Acquisition of Tersus

Acquisition of BBC Fire Protection (Feb 2017)

Acquired for an enterprise value of £4.1m. Founded in 1979, BBC operated nationally from headquarters near Norwich and employed around 100 staff. BBC provides a comprehensive portfolio of fire protection services to over 700 customers with a significant presence in the banking, education, leisure and social housing sectors. BBC’s services were highly complementary to those offered by existing Marlowe businesses.

For the year to 31 December 2015, BBC reported audited revenues of £9.1 million
How we add value:

Since the acquisition we have integrated BBC into our Fire Safety & Security division to take advantage of the synergies between the two businesses. As a result, we have realised significant operational and revenue synergies in the business. Investments in organic growth and significant improvements to the businesses technology, systems and processes have all led to improvements in visibility and productivity. We have also conducted two bolt-on acquisitions which have been integrated into BBC since.

View the RNS on the Acquisition of BBC Fire Protection Limited

Our People:

Acquisition professionals: who work on sourcing, evaluating and executing deals. They work in close-coordination with senior management, the board and the group CEO. We are highly experienced acquirers having conducted ~25 acquisitions since 2016.

Finance professionals: our in-house team is practised and familiar with the due diligence processes which ensures an efficient and professional negotiation process. We can typically complete a deal within 4-8 weeks from the signing of heads of terms.

Funds:

• Our organic growth and internally generated cash allows us to reinvest in growth and helps to funds our acquisitions
• We are listed on the AIM market of the London Stock Exchange, with longstanding and supportive investors and access to significant financial resources
• Long-term financing through a £30m revolving credit facility with an additional £15m accordion with HSBC and NatWest

Acquisition Contacts:

Henry Lynn, Head of Acquisitions
Jamie Hitchcock, Corporate Development Manager
Acquisitions@marloweplc.com
0203 813 8498

Should you be interested in discussing a particular opportunity with us, please get in touch with a brief introduction to the opportunity. Any correspondence or discussions will be treated in strict confidence.