Synseal

Deal Summary

Catalyst advised the management team and their equity backers, H.I.G Capital, on the management buy out of Synseal Extrusions Limited.

Synseal is the UK's leading manufacturer of conservatory roof kits and extruded PVCu profile for window and door systems. Operating from North Nottinghamshire, the business supplies over 700 independent window and door fabricators and installers across the UK and employs over 500 people making it one of the largest employers in the region. The business achieved sales of £76 million in 2009.

What difference did we make?

The owner of the business had made prior attempts to sell the business, most recently in late 2008. Although the 2008 process had not attracted any significant trade or Private Equity interest, the owner was still keen to exit the by early 2010 in order to meet some long held personal objectives.

Catalyst identified that the only way of achieving this was to inject a new CEO into the business as soon as practicable and for that person to then lead a management buy out at an achievable price. In November 2008 Catalyst were introduced to David Leng through their strong contact network in the building products sector and he was appointed as CEO in January 2009. After a settling in period of 6 months, Catalyst then assisted David in negotiating both a price and a process that they believed would secure a Private Equity backer for a management buy out. The process agreed, being a clearly led management buy out with funders offering support to management to buy the business on already agreed terms, was as important as the price agreed. The business had been exposed to the Private Equity market in 2008 as a Vendor led auction and in the current environment Catalyst identified there would be no appetite from Private Equity to look at it again in this way.

The business was presented to funders in September 2009 and H.I.G Capital selected as preferred equity provider in November. Heads were then signed on the deal that had already been agreed by Catalyst with the vendor. Catalyst project managed the deal to a completion in February on the terms that had been agreed in July 2009.

In summary, the process devised and managed by Catalyst delivered the objectives of all the parties – management were central to the decision making process of the deal and chose their preferred funders, the vendor secured the deal he wanted and H.I.G were allowed an “Access All Areas” and exclusive diligence process that allowed them to get comfortable to support the agreed deal in a challenging trading and banking environment.