Caledonia Regulatory News (CLDN)

CALEDONIA INVESTMENTS ACQUIRES AIR-SERV EUROPE

Caledonia Investments plc ("Caledonia") is pleased to announce that it has acquired a majority stake in the European division of AIR-serv, comprised of Airvending Limited and AIR-serv Netherlands B.V. (together "AIR-serv Europe" or the "Business").

Headquartered in Wigan, Lancashire, AIR-serv Europe is a leading designer and manufacturer of air, vacuum and jet wash machines which it provides as turn-key solutions to fuel station forecourt operators across Western Europe.

The Business has over 200 employees, operates from nine offices, and serves c.2,500 customers with c.20,000 machines installed across more than 15,000 customer locations in the UK and Ireland, the Benelux, France, Germany and Spain.

Founded in 1984, AIR-serv Europe has developed a respected brand which represents product innovation and exceptional customer service. Clive Steel became AIR-serv Europe's CEO in 2022 having led Business' operations in the UK and Ireland since 2012.

AIR-serv Europe has operated as an independent division of US based CSC ServiceWorks ("CSC") since CSC acquired the Business, alongside the North-American AIR-serv operations in 2013.

Caledonia has subscribed £142.5m for a 99.8% equity stake in the Business alongside an investment from the management team of c.£0.5m for the remaining equity. The balance of the purchase price will be financed from bank debt facilities totalling £60.0m.

The acquisition underlines Caledonia's strategy of investing in quality, robust, well-established private companies, with proven management teams, and seeking long-term growth.

Commenting on the acquisition, Tom Leader, Caledonia's Head of Private Capital, said:

"We are proud to have become the new owners of AIR-serv Europe and to partner with Clive Steel and his team in the next stage of the company's development. The strength and consistency of AIR-serv Europe's profitability, cash generation and market position are an ideal fit with our Private Capital investment strategy. We believe there are exciting opportunities to build further on the Business' excellent record and to expand its European presence."

Clive Steel, AIR-serv's CEO, commented:

"I am delighted to welcome Caledonia as AIR-serv Europe's new equity sponsor. With Caledonia's financial support, flexibility and long-term investment horizon, I am confident that we can build on the Business' reputation for product quality, technical capability and customer service to take advantage of the significant growth potential in our chosen markets."

Eric Robinson, CEO of CSC, said:

"As owners of AIR-serv Europe for the last decade, our goal was to find a buyer that would be committed to the long-term development of the Business. We are therefore delighted to pass stewardship of the company on to Caledonia; with backing from the Cayzer family and a reputation as a long-term, supportive investor, I wish Caledonia, along with Clive Steel and his team, every success in the future."

20 April 2023

For further information contact:

This announcement contains inside information in relation to Caledonia.

END

Notes for editors:

Caledonia Investments plc

Caledonia is a self-managed investment trust company listed on the London Stock Exchange with net assets of approximately £2.8bn as at 31 March 2023. The company maintains a concentrated portfolio of international quoted, unquoted and fund investments and has paid an increasing annual dividend for 55 years.

In the Private Capital arena, Caledonia typically seeks to invest £50m to £150m in private companies, either on a majority or minority basis, where Caledonia provides enduring capital and support to investee company management teams over the longer term. The Caledonia Private Capital portfolio includes 7IM (a provider of discretionary fund management, asset management and self-invest platform services), Stonehage Fleming (a multi-family office providing fiduciary and investment management services to UHNW clients and families), Cobehold (the holding company of Cobepa, a European unquoted investment house), Cooke Optics (a UK manufacturer of premium cinematography lenses), and Liberation Group (a pub, restaurant and drinks business with a pub estate stretching from Southwest London to Bristol and the Channel Islands).

For additional information on Caledonia Private Capital, please visit www.caledoniaprivatecapital.com and for Caledonia please visit www.caledonia.com.

Airvending Limited and AIR-serv Netherlands B.V. (together "AIR-serv Europe")

Founded in 1984, AIR-serv Europe designs and manufactures air, vacuum and jet wash machines which it supplies to forecourt operators as a turn-key solution.

Headquartered in Wigan, Lancashire, it also has offices in six European countries (the Netherlands, Belgium, Spain, France, Germany and Ireland), employing over 200 people and selling to over 2,500 customers. In its year to 31 March 2022, Airvending Limited reported profit after tax of £4.5m and gross assets of £45.3m, and AIR-serv Netherlands B.V. and its subsidiaries reported an aggregated profit after tax of €0.9m and gross assets of €35.0m respectively.

For additional information on AIR-serv Europe, please visit www.air-serv.co.uk. 

Transaction

Caledonia's investment in AIR-serv Europe was led by Chris Hodges, Theo Tizard, James Lander and Joe Carter Hepplewhite.

Taylor Wessing (Ed Waldron, Jonny Bethell and Martin Yells) provided legal advice and Lincoln International (Phil McCreanor and Aude Doyen) provided corporate finance and debt advice to Caledonia. OC&C (Tom Gladstone) provided commercial advice, Deloitte (Tim Haden) provided tax advice and PwC (James Tubby) provided financial due diligence.

William Blair (Jack Blomfield, Manuel Sammut, AJ Reus and Nick Comhair) provided corporate finance advice to the vendors and legal advice was provided by Allen & Overy (Andrew Schoorlemmer and Robert Hatton). Commercial and financial due diligence advice were respectively provided to the vendors by EY Parthenon (Rishi Shah) and EY (Mark Griffiths).

Liberty Corporate Finance (Kevin Palmer) and K&L Gates (James Cross) advised management.

Neither the contents of Caledonia's nor Air-serv Europe's websites, nor the contents of any website accessible from hyperlinks on these websites (or any other website) is incorporated into, or forms part of, this announcement.