A North West software company, responsible for developing the first automated computerised system for planning retail space has just undergone a multi-million pound management buy-out.
Galleria has implemented its products in some of the world’s leading retailers. Involved in both the development and sale of their software, the company supplies to a wide panel of major multiple retailers and suppliers, including; Tesco, WH Smith and Makro.
The innovative system known as Automated Merchandising, was developed by Galleria Holdings Limited, based in Alsager, South Cheshire and it ensures supermarkets have the correct products displayed in stores, according to product demand, financial performance of product lines, space restrictions and aesthetics.
Galleria, with a £4.5 million plus turnover, has also diversified into web-based technology, developing products which a very large number of smaller retail outlets can now utilise. It now employs over 70 staff and is based at Brundett House in Alsager, near Crewe.
The MBO team; managing director, Ian Duncan-Lewis (40), consultancy director, Robin Teasdale (40) and Jef Richards (28), technical director, have bought out the major shareholder Mark Jellyman who established the original company in 1989.
Advising the MBO team were the Manchester office of Clearwater Corporate Finance who were recently involved in another North West software deal – advising the shareholders of Wigan-based Freeway Software who were acquired by specialist accountancy software group, IRIS.
And in what is their first deal since launching their Manchester office late last year, Royal Bank Development Capital have invested in the MBO team who now head up the market leading company.
Ian Duncan-Lewis, Galleria’s managing director, said the company, which has more than doubled its turnover in the last two years, is now looking to benefit from its suite of patented, market-leading products. “We are anticipating major future growth from our innovative products through the winning of new clients both in the UK and internationally. We believe that this Management Buy-Out is the most effective route for customers and staff alike and will enable Galleria to develop even further.”
Galleria has a number of commercial advantages in its marketplace. It has an excellent understanding of a very specialised industry where competitive advantage for retailers and suppliers lies in being able to apply radical and effective new concepts. It has an effective and proven development team and has patented its world leading solution. Together with its flexible delivery platforms Galleria is well poised to capitalise on massive overseas potential for its product range.
Heading up the Manchester team from Clearwater Corporate Finance was principal Mike Reeves, assisted by manager, Peter Lee.
Reeves commented; “This is an excellent management team who have worked together for over three years and have consistently demonstrated their ability to develop market leading software in a very competitive market. This deal enables the MBO team to fully exploit the opportunities available to its innovative products.”
Andy Gregory, previously finance director at Pennine Retail Systems, who joined Royal Bank Development Capital as investment director to set up their Manchester operation added; “Space planning is an extremely exciting area within the retail decision support software sector. This business has both a range of market leading software tools and renowned expertise and I am sure the MBO team will continue to build on Galleria’s recent impressive growth.”
Assisting Andy Gregory at RBDC was associate Tony Dean.
Legal advisers to the management team were Nick Davenport and Andy Sturge of Turner Parkinson. Nick Davenport has worked closely with the management team for nearly 18 months to achieve the MBO, and in particular assisted in persuading the major shareholder to consider a Management Buy-Out.
Due diligence was carried out by Andersens. Royal Bank Development Capital were advised by Robert Turnbull of Cobbetts.
Debt was provided by The Royal Bank of Scotland, led by Stuart Watson. Legal advisers to The Royal Bank of Scotland were John Whatnall and Stephen Hadlow of Halliwell Landau.