Partner Article

New management team is breath of fresh air for air con business after MBO advised by Garbutt + Elliott

One of the UK’s leading air conditioning companies is set for growth after being acquired in a management buy out (MBO) supported by corporate finance specialists at accountants and business advisers, Garbutt + Elliott.

Air conditioning and data centre cooling specialist, FEL Group, Scunthorpe, has been acquired by a three-strong team, led by newly-appointed managing director, John Higginbottom, who has 20 years’ senior finance experience in construction, manufacturing and facilities management.

FEL Group, founded in 1997, currently has 25 staff, an £8m turnover and works throughout the UK installing, maintaining and repairing air conditioning. The company also specializes in data cooling technology, for which it has in-house mechanical and electrical design expertise, and can be project leader from design and planning to completion as well as carrying out upgrades.

Other MBO team members are operations director, Jonathan Camm, who has 25 years’ experience with electrical and mechanical contracting businesses, and sales director, Jason Preston.

John Higgingbottom says: “FEL Group once saw £20m annual sales and the prime aim of the new management team is to return the business to profitability in line with its expertise and grow it to a more sustainable future, with a balanced customer portfolio, and we will be looking to making acquisitions as part of this strategy.

“We are already doing this and the summer lockdown created huge demand for data cooling due to home networking. This means many of our clients need to build greater resilience in their networks that we can help provide.

“We also help clients use energy with maximum efficiency so the environmental need for greater sustainability is a business opportunity for us.

“Garbutt + Elliott introduced me to several viable finance providers and developed our business plan and financial modelling that enabled us to secure finance to support the MBO. Tony Farmer’s advice and support was invaluable and I continue to work with the firm since the MBO.”

FEL Group clients include Virgin Media, Telefonica, Sky, and national engineering and services company, NG Bailey. The business has recently completed a £400,000 installation in Marlow and is currently working on an £800,000 installation in Leeds as part of an office refurbishment.

Garbutt + Elliott head of corporate finance and partner, Tony Farmer, who advised FEL Group with corporate finance executive, Mark Jennings, says: “FEL Group had been very successful then went through some very difficult times and saw an opportunity to rescue, acquire and reinvigorate the company with a new management team.

“We helped the MBO team raise finance to acquire the business, which may otherwise have been difficult, and to raise working capital. FEL is now winning substantial contracts and moving ahead well and we look forward to continuing to support them.”

Corporate finance solicitor Martin Frost, a partner at Andrew Jackson Solicitors LLP, York, provided legal advice to the MBO team while Bibby Financial Services, Cleckheaton, provided finance and working capital.

Garbutt + Elliott’s 12-strong corporate finance team, which operates from its Leeds and York offices, has managed hundreds of deals throughout the UK across a wide range of commercial sectors.

This was posted in Bdaily's Members' News section by Mike Clarke Communications .