Exit announcement: Carter Accommodation sale generates 4.0x return
20 January 2021
Connection Capital completes another successful MBO exit with sale of portable accommodation hire business
Trade sale of Carter Accommodation Group Limited to Modulaire Group delivers 4x return
Connection Capital, the specialist private client investment business, has completed another successful exit from a management buyout (MBO) investment, with the sale of Carter Accommodation Group Limited, a leading UK portable accommodation hire company, to trade buyer Modulaire Group.
Private investor clients of Connection Capital invested £5.3million in the company’s £11.2million MBO in 2015. In addition to a change of ownership into management’s hands, the investment provided significant growth capital to fund the expansion of its hire fleet.
The pace of Carter Accommodation’s growth was so rapid that the initial investment was supported by two further funding rounds from Connection Capital clients. The scale of growth has seen trading transformed from £7m turnover at the time of the MBO, to EBITDA in excess of £7m on the sale.
The sale to Modulaire, a leading business services company specialising in modular space which has operations in 25 countries, delivers a return on investment of 4x the original investment.
Established in 1988 and based near King’s Lynn, Norfolk, Carter Accommodation Ltd supplies customers in the UK construction, infrastructure, leisure, education, agriculture, energy and health sectors and once even supplied a portable unit for Sir Elton John.
Its product range includes high-spec temporary modular buildings for use as offices, labs, wards or classrooms, plus cabins, containers, welfare units and energy efficient eco units. Its long-standing blue-chip customers include Skanska, Willmott Dixon and Morgan Sindall.
The deal is the latest successful exit from an MBO for Connection Capital, following the 2019 sale of leading firm of financial risk management advisers JCRA Group Limited to Chatham Financial Group, in which its private investor clients achieved an attractive return in just two years.
Bernard Dale, Managing Partner at Connection Capital, comments, “With sufficient funding support to enable the dedicated and able management team to achieve their growth ambitions, Carter Accommodation has powered forward in the portable accommodation sector in the past five years.”
“So much so that it has attracted significant interest from trade buyers and private equity investors alike. We are satisfied that this is a win-win deal for all concerned, delivering attractive returns for our clients, and unlocking further potential for Carter Accommodation to support its continued expansion.”
Darren Arnold, CEO of Carter Cabin Hire comments, “Connection Capital’s support has been invaluable, enabling us to accelerate our achievements and capitalise on opportunities much faster than we thought we could. They’ve given us a strong foundation to further the growth of our business – not just in the structure of our funding but in the ideas and advisory support they have contributed too.”
“We’re now ready for the next stage in our journey and we’re delighted to be embarking on it with Modulaire Group, whose operations – and particularly their UK business, Elliott - are an excellent strategic fit with ours. Trading prospects remain positive and we’re keen to capitalise on the opportunities that 2021 has to offer.”
The shareholders of Carter Accommodation were advised by Stephens (M&A), Gateley plc (legal) and Grant Thornton (vendor due diligence).
About Connection Capital
Connection Capital LLP is a Financial Conduct Authority authorised and regulated, specialist syndicator of investment funds from private professional investors into direct private equity, private debt and commercial property deals, as well as alternative asset funds. It currently has some £300 million of funds under management across a diverse portfolio.
Connection Capital provides a specialist managed service to help professional clients build up their own alternative asset portfolios. Private investors self-select which opportunities they want to take a stake in. Opportunities are identified and negotiated by Connection Capital, which also carries out all due diligence and manages the investment from completion through to exit, on its clients’ behalf.