Britton Group completes MBO in a £46 million deal


Britton Group (Holdings) Limited, the UK’s second largest supplier of flexible plastic packaging materials has undergone a £46 million management buy-out backed by the East Midlands office of LDC.

The company, which ranks as one of the top ten producers in Europe, is now looking to grow turnover significantly on the back of a major capital expenditure programme as it seeks to expand its market share in the UK and Europe.

Advised by Clearwater Corporate Finance, the MBO team were led by Mike Clark who joined Britton as CEO in November 2003. The company has major subsidiaries in Winsford, Cheshire (Britton Taco), Louth in Lincolnshire (Britton Merlin) and Hartlepool (Britton Decoflex)* – see notes to editors.

Generating sales of around £90 million, Britton has the capacity to manufacture over 100,000 tonnes of plastic film each year. With circa 850 employees, Britton has invested in state of the art printing equipment enabling it to meet the exacting standards of its largely blue chip client base.

Britton’s CEO, Mike Clark who was previously managing director of Tyco Plastics UK Ltd said, “Britton as a group is a tremendous business employing some really talented individuals and I look forward to seeing it realise its true potential over the forthcoming period”.

The company’s products which include; mailing film, industrial liners, polyethylene reels for packaging, frozen films, pouch packaging and most recently collation shrink-film multi-pack outers are used in a diverse range of industries including the food, drinks, construction, retail, financial, pharmaceutical and medical sectors.

Plastic is the most cost effective packaging solution in the world. The UK market for custom films is 1.1m tonnes and the Western European market is 6.1 million tonnes and further growth in both markets is projected.

The Britton Group was originally set up by two entrepreneurs as a vehicle to acquire a range of packaging companies engaged in film extrusion and corrugated box manufacture. During the 1990’s the business grew through acquisition, and was itself acquired in 1998 by US-based ACX Technologies Inc. The film side of the business then underwent a sale to management and shortly afterwards Britton acquired Merlin Flexible Packaging. Mike Clark, the current CEO joined late last year.

The total financing package of £46 million was raised by Clearwater with the East Midlands office of LDC providing over £18 million of venture capital and the Nottingham office of Bank of Scotland making available significant bank finance.

Jon Hustler, partner with Clearwater who originated and advised on the transaction commented: “We are delighted to have been able to orchestrate the bringing together of Mike Clark and his team with the Britton Group. Their experience in the industry coupled with Britton’s reputation and quality products, present a fantastic opportunity going forward. It is also a tribute to the Midlands professional community that the deal was advised and financed entirely from within the region.”

Mark Freer, investment director who led the transaction on behalf of LDC said: “LDC is delighted to support Mike Clark and his team in acquiring the Britton Group, with an investment of £18.65 million from our East Midlands office.

“The deal underlines LDC’s desire to support high quality management teams in the regional MBO marketplace. In particular, it confirms our continued presence in the East Midlands, where there continues to be a vibrant professional community able to source and transact deals of this nature.”

The Clearwater Corporate Finance team led by partner, Jon Hustler included director, Rob Britton and assistant director, Dan Bowtell.

Ian Pirrie, director with Bank of Scotland Nottingham led the banking team. The legal work on the transaction was sourced from Eversheds (Ben Johnson and Stephen Hill) leading on behalf of the management and the buyer and with Browne Jacobson (Gavin Cummings) and freethcartwright (John Heaphy) providing legal advice to LDC and the Bank of Scotland respectively.

Ben Johnson of Eversheds added: “We have been working with Mike for sometime in relation to this project and it is good to see him and his team conclude a great deal”.