Close Brothers in UK chemicals MBO

London - Global chemicals sector investor Close Brothers Private Equity (CBPE) has backed a £129-million management buyout of Warwick International from its US parent, Sequa Corp. Warwick, which is headquartered in Mostyn, North Wales consists of two separate businesses, a speciality chemical manufacturer focused on the global laundry detergents market and a broad network of niche chemical distributors based across Europe and Asia.

CBPE has invested £55 million in the deal and is acquiring the business alongside the incumbent management team led by CEO, Bob Ellis. The Royal Bank of Scotland's Corporate and Structured Finance team in Manchester led a four bank club which provided the rest of the funding for the deal. The banking club included Lloyds TSB Corporate Markets, Barclays and HSBC.

With sales of over £180 milion, Warwick has been developed over the last 10 years by Ellis and his executive team of Steve Williams, Barry Tilby and Doug Lovatt and, said CBPE, forms "a strong base for a continued expansion strategy both from available organic growth in its core markets and bolt on acquisitions such as the recently announced acquisition of Malaysian distributor, GME."

Warwick claims to be a global market leader in the manufacture and supply of certain speciality chemicals used by all the leading laundry detergent manufacturers across their suite of high street laundry products. This is a well established market with growth driven by acceptance and adoption of western laundry practices across both Eastern Europe and the Far East, added the equity firm.

Warwick joins a long string of previous CBPE investments in the chemical sector, including Chance & Hunt (acquired from ICI plc), Aroma & Fine Chemicals (acquired from IFF Inc.), Minova International (acquired from BP plc) and BWA Water Additives (acquired from Chemtura Corp.).

Paul Lupton, Head of Corporate Finance for the North at Deloitte, said: "Warwick International attracted a lot of interest from private equity houses and trade buyers. Its selection of Close Brothers Private Equity as a backer is a vote of confidence in the significant experience that the private equity house has in the chemicals industry."