Lyceum supports £32m acquisition of SGP
Lyceum Capital has led the £32.2m acquisition of the FM division of AIM-listed Johnson Service Group PLC including SGP Property & Facilities Management (SGP), an independent provider of facilities management (FM) supply chain services.
The deal sees the lower mid-market investor back a new and experienced management team to drive the company’s expansion in its existing and new growth sectors, as well as further develop its suite of services.
Established in its current form in 2007, SGP supplies a range of managed facilities and property services under long-term contracts to its blue chip client base across the healthcare, education, corporate and retail sectors.
The company uses its own FM technology platform to plan, report and analyse trends to help its customers operate and manage their estates more efficiently. The delivery of this offering is coordinated by SGP and outsourced to the accredited suppliers, both local and national, enabling SGP to provide and manage an independent, high quality and fully tailored service which represents the best value to individual clients with large, complex portfolios.
The business’ complementary property services include service charge and business rate advisory and technical and environmental consultancy relating to construction design, energy usage and building fit-out, refurbishment and relocation.
Gerry Higgins and Martin Holt will lead the management team and have been appointed Chairman and Chief Executive of SGP respectively.
Higgins was the Chairman of former Lyceum Capital portfolio company M&C Energy, helping it to grow headcount from 370 to 500 in two and a half years to become the largest outsourced energy management firm in Europe.
Holt has extensive industry experience having led the merger of MITIE Engineering Maintenance Ltd with Dalkia FM, increasing the combined business’ revenue by more than 40 per cent over the following three years to create a leading player in the energy-focused FM sector.
The management team will work closely with Lyceum to target growth vertical sectors, whilst further developing the company’s strong technology platform and adding to its broad range of services.
The FM division of Johnson Service Group, which comprises SGP and other businesses which are also included in the acquisition, is expected to generate EBITDA of £5.3m in its current financial year (ending 31 December 2013).
Lyceum founding Partner Jeremy Hand, who will also join the company’s board, said: “SGP has a strong reputation for providing high quality, independent services that represent excellent value for its clients. We are excited to be backing such an experienced management team and look forward to working with them to help build SGP’s market presence and capability both organically and through targeted acquisitions.”
Martin Holt, Chief Executive of SGP, commented: “Organisations with large and complex property portfolios are increasingly seeking to appoint a single, reliable point of contact for all of their FM requirements with a view to delivering cost savings and operational efficiencies.
“This is an exciting opportunity to redefine what good looks like in the industry. SGP offers a technology enabled platform with the potential to provide strong, proactive, transparent and independent governance for clients.
“With our loyal client base, comprehensive offering, well invested technology platform and, crucially, independence from our supply chain, we are well positioned to expand against these strong market dynamics. This deal will enable us to invest in our core FM business to grow organically, whilst exploring targeted acquisitions to enhance our service offering and scale.”
Gerry Higgins, Chairman of SGP, said: “Following this transaction we have a clear and significant opportunity to drive SGP’s expansion through the further development of services and investing in core operations. The company’s existing track record for reliability and cost effectiveness will also be central in creating a ‘total’ FM solutions provider, for which there is real market appetite.”
Kevin Elliott, SGP’s current Managing Director, will remain with the business in a consultancy role until June 2014. He added: “This transaction represents the next phase in SGP’s development, with the company well placed to continue its strong expansion under the stewardship of the new management team and Lyceum. I look forward to working with them over the coming year to support this growth whilst ensuring an efficient handover process.”
ENDS