Manchester-based Ardenton Capital has backed PP Control & Automation in the investor’s second deal.
Ardenton now owns a majority stake in PP Control & Automation (PP), which employs more than 230 people at its world-class manufacturing facility in the West Midlands.
Established in 1967 and headquartered in Walsall, PP is an outsourced equipment and machine manufacturer that has grown to become one of the world’s leading providers of control and automation solutions. Traditionally focused on the manufacture of electrical control panels, PP now offers wider and more specialist services, including cable harnesses, electronic assembly, electrical control panels, electro pneumatic systems, electro mechanical assembly and machine building.
PP Control has an established blue-chip customer base, supporting clients’ manufacturing needs across the globe.
Tony Hague, long-standing managing director of PP, has become a significant shareholder in the business as part of the deal and will become chief executive officer, whilst founder David Fox will take the role of chairman.
Canada-headquartered Ardenton differs from most private equity firms by investing with a long-term focus with no intention to divest the businesses it acquires. Ardenton has also expanded its Manchester team with the appointment of James Worrall, associate investment director; and Jonny Nixon, investment manager as it grows its UK presence.
Iain Marlow, Director of Ardenton UK, said: “PP Control & Automation is a great example of a world class UK manufacturer exporting its services and products all over the globe.
“We are exceptionally proud to have the opportunity to partner with Tony Hague and his management team to help take the business into its next phase of growth and ensure the business continues to be a leading light of West Midlands industry.”
“We’ve also invested heavily in our team in recent months. With the addition of James and Jonathan we’re well placed to respond to the wealth of promising investment opportunities, while continuing to support our portfolio companies as they target further growth.”
Chief executive officer, Tony Hague, who has been with PP since 2001 added: ““We recognised over 12 months ago that if we were to realise our aspirations of truly growing PP in the way we believed possible, we would need a new business partner to work with.
“Sales have increased nearly 30% in the last two years, but to take us to £40m and beyond we needed to partner with a long-term investor to really accelerate the growth. There were many organisations keen to invest in PP.
“However, we knew from the very first meeting with Ardenton Capital that its differentiated approach to sustained investment, with no intention to divest, perfectly aligned itself to the way we do business and will ensure we deliver on our ambitious expansion plans.
Ardenton targets majority investments in businesses alongside strong incumbent management teams who they seek to support in delivering long-term sustainable growth for their businesses. Directors Iain Marlow and Mike Bradbury opened the UK office of Ardenton in late 2016 and made the first UK investment into Corbetts the Galvanizers in the West Midlands in 2017.
Tony concluded: “We are seeking strong growth both in the UK and further afield and the style of strategic outsourcing solutions we offer seems to be very much in demand.
“There is a clear focus from our customers to reduce both their manufacturing and sales lead times, as well as improving total production costs – we have a proven track record in working with 13 of the world’s largest machinery builders to do just that.”
PP Control & Automation reached its fiftieth year in September 2017 and marked the occasion by securing £2m of new contracts. It has grown into one of the world’s largest and most respected suppliers of electrical control systems and sub-contract manufacturing solutions to customers involved in the machine tools, packaging, printing, medical, pharma, scientific and food processing sectors.
Senior debt and working capital facilities were provided by the Midlands Corporate and Structured Finance team of Yorkshire Bank led by Ian Howey, Ian Mansell and Sunil Prabhaker. Pinsent Masons advised Ardenton on the transaction. The team was led by Kieran Toal, James Skivington and Tom Ralph. Financial due diligence was carried out by Mazars Birmingham; David Preston, Luke Yates and Trystan Shaw. Commercial due diligence was by David McClelland at Carlton Strategy Advisors. The vendors were advised by John Hunt of KBS Corporate Finance.
"We knew from the very first meeting with Ardenton Capital that its differentiated approach to sustained investment, with no intention to divest, perfectly aligned itself to the way we do business. "
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