Chelverton investor club snaps up Electrobase
Chelverton Asset Management has acquired Electrobase, a Dartford-based engineering services company, for almost £4m.
It is the second transaction for the investment company's Investor Club, a scheme it launched in June 2013 to invest up to £3m in small businesses with high growth potential
The club raised £2m of equity from its High Net Worth membership to fund the £3.9m acquisition, along with institutional investor partner Chrysalis VCT.
Electrobase specialises in precision sheet metal work and the deal will allow it to expand its presence in the aerospace sector through its salt bath dip brazing technique and the appointment of chief executive Tim Harrison, who has "significant" experience in the industry.
Chelverton's investment director, David Hart, who led the transaction, said: "We worked with Tim Harrison to source this investment off-market, gaining the confidence of the current management team, who will all remain with the business going forward and are re-investing.
"The combination of their expertise in the very niche dip brazing application, allied to Tim’s contacts and sales and marketing experience provided a compelling proposition for our investors."
Hart will also join the board of Electrobase.
Harrison added: "Our over-riding strategic thrust is the creation of a business which is truly world class in its chosen sectors and the development of the business over the next five years.
"We have a highly capable management team to make that possible and believe the business can deliver a turnover of circa £10m in that timeframe, with sustainable profits and strong cash flows."
Supporting debt finance was provided by Santander.