£425m business created with Pertemps Network Group
A planned buyout by the joint management teams of Pertemps and Network Group Holdings will create a company with a combined turnover of more than £425m.
The MBO brings the two businesses back together after Solihull-based Network demerged from Meriden-based Pertemps in 2004 to form a separate AIM-listed business.
The transaction, which it is claimed will create the UK's largest independent provider of specialist outsourced recruitment services, rebranded as Pertemps Network Group (PNG), was backed by private equity provider LDC to support the growth strategy in the UK and overseas, as well as providing funding for a planned acquisition programme.
An agreed succession plan, by which the founders of Pertemps and Network will progressively step back from the day-to-day running of the business, with the existing senior management team assuming greater responsibility, formed part of the MBO deal.
PNG's employees have also invested in the business and will hold about 40 per cent of the group's equity going forward.
Pertemps chairman Tim Watts and the founders of both businesses will continue to hold a "substantial equity investment" in PNG.
Roger Englefield, Pertemps managing director and part of the MBO, told Insider: "This transaction forms part of our strategy to transfer ownership of the business from Tim Watts and the founders to Pertemps Network Group employees.
"It also provides for succession planning for our talented and highly capable senior management and staff. It is our intention to put into practice the group's planned growth and acquisition strategy to be the number-one recruitment business in the market."
The management teams of Pertemps and Network created a new management buy-in vehicle called NGH Topco to merge the two businesses.
NGH Topco reached an agreement on the terms of a recommended cash offer of £19.6m for the whole of the issued, and to be issued, share capital of Network.
LDC was led by investment directors Steve Aston and Chris Hurley, who will join the board with immediate effect, as well as Alistair Pendleton.
The transaction was completed with support from a number of Midlands-based advisers, including Eversheds, which acted as legal adviser to LDC, and Gateley, which advised PNG's management team and Network.
Mazars provided financial due diligence, with the board advised by Pinsents.
