UK: UK private equity investor LDC has sold its investment in UK refrigerant supplier A-Gas to global investment firm KKR.
LDC invested £29m in A-Gas in 2011 to support the group’s growth strategy. It subsequently invested an additional £30m to assist the business in completing six acquisitions designed to expand its geographic footprint and service capabilities. Today, A-Gas operates from 16 sites across Europe, Australia, South Africa and North America.
It has also expanded its service capabilities from distribution to full recovery and reclamation of a wide range of environmentally refrigerants and fire protection gases.
Between 2011 and 2016, the business grew revenues 79% and profits (EBITDA) 103%. The sale, which is subject to customary regulatory clearances, will see LDC achieve a 3.3x money multiple on its original investment and an IRR of 24%.
“Our partnership with LDC has enabled us to build a group with real global scale and breadth of offering, whilst remaining fully focused on our commitment to technical excellence and customer service,” commented A-Gas group CEO Andrew Ambrose. “LDC’s financial, strategic and operational support over the last six years has been a key ingredient in our success, helping to transform the group and creating a platform for continued growth.
“Securing the backing of a global investment firm like KKR now enables us to continue our expansion in a growing and highly complex market from a position of real strength, which will benefit our customers and employees alike.”
LDC has backed six acquisitions since 2011. These included the purchase of US refrigerant supplier Coolgas, US-based recovery, reclamation and recycling firm RemTec International, Australian companies Technochem and SA Rural and UK based A-Zone Technologies in 2012. Last year A-Gas added Rapid Recovery, a refrigerant recovery business headquartered in Phoenix, Arizona.
Martin Draper, CEO of LDC said: “Our journey with A-Gas is an excellent example of how private equity can unlock the potential in a business, particularly through a buy and build strategy. The six strategic acquisitions and integration of those businesses has resulted in a near doubling of revenues and tripling of employee numbers since our original investment.”