Graphite Capital

• Graphite’s investment in Alliance Medical enabled institutional investors and existing management to exit the company and new management to be incentivised
• The company became the UK market leader in the public and private healthcare markets for static and mobile MRI scanners
• Overseas operations were successfully established with the launch of an Italian joint venture
• Turnover almost doubled and operating profit grew considerably during the period of Graphite’s ownership

In 2001 Alliance Medical was sold for £84 million to Dubai International Capital (DIC)

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• At the time of Graphite’s investment Applied Energy was performing poorly due to operational disruption caused by the earlier merger of three separate brands
• A successful turnaround was quickly achieved and the product portfolio was refreshed and expanded
• The company increased its share of the electrical wholesale channel and penetrated new routes to market, including merchant and retail
• Turnover and operating profit grew in the period of Graphite’s ownership

In 2007 Applied Energy was sold to Glen Dimplex, an acquisitive Irish business.

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• Graphite provided Avery Healthcare with development capital to pursue a buy-and-build strategy, backing the two founders to set up the company
• Avery Healthcare grew rapidly to become a mid-sized operator with 21 care homes, completing seven acquisitions in the first 18 months
• With Graphite's help, the company raised £80 million of debt
• Following the sale of Avery Healthcare, the management team and Graphite retained a number of immature homes and are continuing the buy-and-build strategy with Optimum Care and Willowbrook Healthcare

In 2007 Avery Healthcare was sold to Southern Cross plc, a listed care home operator

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• Graphite invested at an early stage of Bridgewell’s development to fund growth
• Bridgewell rapidly expanded the range of its services including launching a broking operation
• The company acquired a large number of retained clients across a variety of industry sectors
• Turnover and operating profit grew considerably in the period of Graphite’s ownership

Bridgewell was quoted on AIM and subsequently acquired by Landsbanki in 2007

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• Graphite funded the start up and expansion of Clearminster alongside a successful care home entrepreneur
• Rapid growth was achieved despite a very difficult market environment in the early stages of the investment
• Between 1998 and 2003 Clearminster successfully completed an acquisition programme and grew to an 18 home group with 570 beds
• EBITDA before head office costs grew from zero to £5.2 million under Graphite’s ownership

In 2003 Graphite sold its stake in Clearminster to the existing co-investor

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• At the time of Graphite’s investment Clinovia was a loss-making division of a US corporate
• Graphite and the management team immediately restructured the company to improve profit margins, product delivery and general management
• The implementation of a differentiated service and premium pricing product strategy enabled the company to increase product penetration and market share significantly
• Operating profit more than trebled to £3.0 million under Graphite’s ownership

In 2000 Clinovia was sold to LVL Medical, a pan-European home healthcare group based in France, generating a multiple of 7.9 times cost 

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• Graphite invested at an early stage of Computacenter’s development to fund growth
• The company expanded rapidly through organic growth and was the UK market leader by 1997 with 2,500 staff employed across its office network
• Direct operations were established in France and Germany 
• Turnover and operating profit grew considerably under Graphite’s ownership to £1.1 billion and £52 million respectively

In 1998 Computacenter was listed on the London Stock Exchange with a market capitalisation of £1.1 billion

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• Graphite invested in Denison when it was loss-making and immediately introduced an experienced and successful management buy-in team
• The company was rapidly turned around with significant turnover growth of over 40 per cent between 1993 and 1997
• Operating margins were increased from 2.1 per cent in 1993 to 13.0 per cent in 1996 due to substantial cost reductions and management reorganisation
• Operating profit grew considerably from a loss of $1.8 million in the year prior to Graphite’s investment to a profit of $19.3 million at the time of exit

In 1997 Denison International was listed on the US Nasdaq with a market capitalisation of $53.1 million, generating an IRR of 95 per cent

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• Graphite’s investment allowed the founding shareholder to retire from the business
• Within two years the number of participating dentists increased from 2,750 to 4,900
• The number of patients utilising payment plans increased from 135,000 to 500,000 in the same period
• Turnover increased fivefold to £53 million and operating profit grew substantially under Graphite’s ownership

In 1993 Denplan was sold for £42 million to Private Patients Plan (PPP), generating a multiple of 8.0 times cost

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• Graphite acquired 200 of the best Dewhurst retail outlets from the receiver of its parent company, Union International, along with 125 of its freehold properties through a joint venture vehicle, Angloarch
• The properties were sold within 18 months generating a gain of £4.4 million and a return of 76 per cent on the Angloarch investment
• The Dewhurst brand was successfully re-established and the company continued to trade strongly through a series of meat market crises by cutting costs and reducing the number of outlets
• Profitability was restored to Dewhurst and the company remained the UK’s premier independent meat retailer

In 2005 Dewhurst was sold to a trade purchaser, generating a multiple of 2.0 times

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• Equanet’s stockless model was unique in IT hardware distribution
• Graphite’s investment facilitated management succession and allowed the founders to realise part of their stake in the business
• Profit margins rose significantly above the sector average due to the electronic integration of the supply chain with direct links into supplier warehouses
• Turnover and operating profit grew substantially during the period of Graphite’s ownership

In 2005 Equanet was sold to Dixons Stores Group

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• Graphite invested at an early stage of Game’s development to fund growth
• The company grew from 12 to 60 shops between 1993 and 1998, becoming the second largest specialist electronic games retailer in the UK
• Operating profit increased from near zero in 1993 to £7.1 million at exit
• Having floated in 1998, Game was subsequently acquired by its major competitor, Electronics Boutique

In 1998 Game was listed on the London Stock Exchange, generating an IRR of 60 per cent

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• At the time of Graphite’s investment Go Plant was a loss-making company in the Environmental Services Division of AAH plc
• The turnaround quickly gathered pace as the company diversified from its road sweeper base to the provision of a wider range of municipal vehicle assets
• Asset utilisation was significantly improved and several acquisitions were made
• During Graphite’s ownership turnover grew by 59 per cent to £27.6 million and operating profit, after finance interest, increased sharply to over £3.0 million at the point of exit

In 2007 Go Plant was sold to Easternrange, a privately-owned investment vehicle

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• Graphite invested in the start-up of Golden Tulip to develop and manage superior budget hotels across the UK
• The company grew to operate six hotels across the UK and developed a strong and valuable pipeline of further openings
• The sale and leaseback of two hotels enabled the company to reduce borrowings and repay part of Graphite’s loan stock prior to exit
• Turnover and operating profit grew strongly under Graphite’s ownership with significant operational and financial improvements across the portfolio

In 2007 Golden Tulip was sold for £44 million to Whitbread PLC, generating an IRR of 35 per cent

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• Graphite invested in Hiscox Dedicated to participate in the underwriting capacity of the four Lloyd’s of London in-house Hiscox syndicates
• The company successfully expanded beyond the Lloyd's business and developed a retail business servicing high net worth individuals and professional firms
• Hiscox syndicates continually achieved lower cost ratios than its competitors
• The company was admitted to the Alternative Investment Market (AIM) in 1995

In 1997 Hiscox Dedicated was listed on the London Stock Exchange 

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• From start-up in 2000 Huntress grew EBITDA to more than £5 million by 2007
• Graphite backed a strong and experienced management team led by Gary Laurence, a serial entrepreneur
• Growth was driven by the successful roll-out of 15 offices mainly in the South East and London

In 2007 Huntress was sold to Nomura Private Equity, generating an IRR of 39 per cent

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• Graphite was a founder investor in the start-up of ICG in 1989, backing a strong management team with extensive experience in structuring debt and equity packages for management buy-outs
• The company raised a series of third-party funds to increase its revenues and grow its loan portfolio
• ICG became the leading provider of mezzanine finance in the UK and subsequently in continental Europe
• The loan book grew to £170 million and operating profit increased to £18 million during the six years of Graphite’s ownership

In 1994 Intermediate Capital Group was floated on the London Stock Exchange. Graphite continues to have a shareholding and has generated an IRR of 23 per cent to date.

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• Graphite’s investment allowed the founding family to retire from the business 
• Jane Norman consistently achieved higher sales densities than its competitors 
• The store roll-out accelerated, with the number of outlets doubling over three years from 48 to 96 outlets
• Turnover and operating profit grew considerably in the period of Graphite’s ownership

In 2005 Jane Norman was sold for £117 million to Baugur

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• Kingsclear was a rapidly-growing elderly care home business
• Under Graphite's ownership after the initial investment Kingsclear grew from 332 beds in seven homes to 995 beds in 19 homes
• Operating profit doubled under Graphite’s ownership
• At exit, further growth and additional profitability was expected from maturing homes and from the opening of new homes under development

In 1996 Kingsclear Homes was sold to Northern Rock

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• In the three years of Graphite’s ownership Kurt Geiger more than doubled in size to become one of the largest footwear specialists in the UK
• The business opened 24 stores in the UK, contracted new department store partners and substantially grew online sales
• A major focus on international expansion resulted in market entry in the Middle East, Turkey and Russia, in addition to the company’s Western European presence
• EBITDA more than doubled to reach £20 million in the year to January 2011

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• In 1995 Graphite provided expansion capital to London and Henley to fund its growth in the London residential property market
• Graphite worked with the management team to develop financial systems to optimise portfolio and development returns
• During Graphite’s ownership, £18.9 million worth of properties were developed and sold
• Additional properties worth a further £44.2 million were developed and retained by the company for rental income

In 1998 London and Henley was sold to Security Global Realty, a US trade buyer, generating a multiple of 2.2 times cost

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• LS Group was formed from the merger of Leaderflush and Shapland, which created the UK’s largest manufacturer of high-performance doors
• The management team and Graphite identified substantial revenue and cost synergies, which were realised in full in the three years following the initial investment
• The enlarged group successfully established itself as the preferred supplier to a number of leading building contractors
• EBITDA more than trebled during the period of Graphite’s ownership, growing from £1.6 million to £5.6 million

In 2005 LS Group was sold for £47 million to SIG plc, a supplier of specialist construction products, generating a multiple of 6.1 times cost

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• Graphite invested in Mailroom Management Services as a start-up division within Security Despatch which was spun out as a stand-alone business in 1998
• The company quickly grew its customer base and developed a leading market position in the outsourced operation of UK postrooms 
• After initial losses, the company became highly profitable and cash generative
• Turnover grew from zero to £23 million at the point of exit

In 2002 Mailroom Management Services was sold to the Swiss Post Office generating a multiple of 8.6 times cost 

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• At the time of Graphite’s investment Maplin was recovering from a period of poor trading
• The turnaround quickly gathered pace, as the product range was expanded further and gross margins improved with better sourcing
• Like-for-like sales consistently grew at double-digit rates and 26 additional stores were opened
• Operating profit quadrupled during the period of Graphite’s ownership

In 2004 Maplin was sold for £244 million to Montagu Private Equity

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• Graphite invested at an early stage of Ottakar’s development to fund the roll-out of additional bookshops
• The company expanded from seven to 47 bookshops during Graphite’s six-year period of ownership
• Growth was achieved through a combination of store openings and strong like-for-like sales growth
• Operating profit increased twenty-fold between Graphite’s first investment in 1992 and the flotation in 1998

In 1998 Ottakar’s floated on the London Stock Exchange and was subsequently sold to HMV Group plc in July 2006, generating an IRR of 50 per cent

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• When Graphite acquired Paperchase in 1996 it was a loss-making division of WH Smith
• An experienced team was introduced to return the business to profitability
• Under Graphite’s ownership the number of stores increased from 12 to 61 across a variety of locations
• Annual sales more than trebled from £7.7 million to £27.4 million during the period of Graphite’s ownership

In 2004 Paperchase was sold to Borders, the US-based book, film and music retailer

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• Graphite initially invested development capital in PIFC for a minority shareholding to enable the company to fund an acquisition
• Graphite subsequently backed an MBO when the company’s founder decided to realise his shareholding and step back from managing the business

• Following the buy-out, the company’s business model was professionalised and its range of services was broadened
• The industry underwent significant regulatory and strategic changes and Graphite and the management team worked together closely to position the business for a successful exit

In 2007 PIFC was sold to a subsidiary of Axa UK

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• Graphite led the management buy-out of PSD in 1991 and subsequently expanded the business
• The company grew rapidly through a combination of organic growth and three bolt-on acquisitions made in the first two years of investment 
• The company became the clear market leader in the growing technology recruitment sector
• Turnover and operating profit grew considerably during Graphite’s ownership, reaching £24.8 million and £8.8 million respectively

In 1997 PSD was listed on the London Stock Exchange with a market capitalisation of £50 million, generating an IRR of 52 per cent

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• Graphite backed Ridgmont’s founder to complete a secondary buy-out in 2001
• The care homes sector was out of favour with investors as profitability in the sector had been held back by over-capacity and fee pressure from local authorities
• The medium-term outlook was positive due to underlying demand from demographic changes and the opportunity to consolidate a very fragmented industry
• During the period of Graphite’s ownership, Ridgmont acquired a competitor, nearly doubling the number of beds, and the company’s profits trebled

In 2005 Ridgmont was sold to Ashbourne Healthcare, a larger care home operator, generating an IRR of 79 per cent

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• In 1992 Graphite identified the opportunity to acquire Salt Union from its parent, ICI, working alongside an experienced buy-in management team
• Profitability was immediately increased through productivity improvements, overhead reductions and price increases
• The company generated significant cash which enabled all of the senior debt to be repaid within three years
• Operating profit increased by 125 per cent to £14.1 million during Graphite’s three years of ownership

In 1995 Salt Union was sold for £85 million to a US chemicals group 

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• Sealine was the established market leader when Graphite backed the management buy-in in 1998
• Graphite supported the buy-in team’s strategy of changing the culture of the business from manufacturing-led to sales-led
• Growth of the company’s sales and profitability was achieved by successful expansion of its overseas markets, particularly to the rest of Europe
• The sale to a major US boat manufacturer generated a multiple of 2.3 times cost for Graphite

In 2001 Sealine was sold for $49 million to Brunswick, a US boat manufacturer

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• The business grew successfully following the management buy-out from British Telecom in 1992
• Turnover increased substantially in the year after the buy-out, aided by the successful launch of a number of new products
• The operating margin rose from 14 to 27 per cent and strong cash generation enabled substantial early loan repayment
• Operating profit more than doubled during Graphite’s ownership

In 1993 ShareLink was listed on the London Stock Exchange with a market capitalisation of £42.1 million, generating a multiple of 7.4 times cost

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• At the time of Graphite’s investment in 1997, Sodastream was a small, underperforming and undervalued division within Cadbury Schweppes
• The management team and Graphite quickly identified a new market opportunity away from carbonated soft drinks and towards carbonated tap water
• The company grew rapidly into new markets in Europe including Germany, Austria and Switzerland
• Turnover grew by 31 per cent and operating profit by 156 per cent during the single year of Graphite’s ownership

In 1998 Sodastream was sold for £17.1 million to a major trade competitor, generating a multiple of 3.6 times cost 

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• When Graphite invested in Stalwart in 1994, the company was in financial difficulties due to poor market conditions and needed significant capital to grow
• We backed a strong management team which had successfully put the business at the forefront of popularising the Home Income Plan (HIP) market
• Several new, innovative insurance products with higher premiums were introduced for consumers with lower life expectations
• Within three years the company had grown premiums from £5 million to £100 million and had captured 70 per cent of the HIP market

In 1997 Stalwart was sold for £43 million to a trade purchaser, generating a multiple of 2.9 times cost 

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• When Graphite led the public-to-private management buy-out of SBJ in 1999 the company was underperforming and its shares undervalued
• Management and Graphite were quickly able to turn the company around, immediately stripping out costs associated with being a plc
• Two subsidiaries were sold to trade, generating £12 million, which enabled the company to repay 60 per cent of the initial purchase price
• Operating profit doubled during the period of Graphite’s ownership

In 2001 Steel Burrill Jones was sold to the management team for £33.6 million, generating a multiple of 3.4 times cost

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• Streamline was formed from the merger of several separate road services and building products businesses within Shell
• Substantial synergy benefits were gained as the management of the diverse group of businesses was centralised
• The road services business grew successfully as more contracts were outsourced by governments in the UK and France 
• Profitability in the building products business grew as the construction industry recovered from the recession in the early 1990s

In 1996 Streamline was floated on the London Stock Exchange 

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• Summit had a good market position in niche segments in the UK with clinically proven and patented products and the opportunity to expand from this platform
• A new CEO was introduced at the time of the buy-out to supplement a strong incumbent team
• Summit's growth was achieved through major new product launches, significant expansion of export revenues and two bolt-on acquistions
• Profit and turnover both more than doubled during the six years of Graphite's ownership

In 2008 Summit Medical was sold for £36 million to The Riverside Company. 

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• Tesla had established itself as the leading supplier of gradient coils for MRI scanners and electromagnets for particle accelerators and semiconductors
• The management team secured long-term contracts with leading medical equipment manufacturers, underpinning future growth
• Bolt-on acquisitions in Europe and the USA solidified the company’s leading global position
• Operating profit more than doubled during the period of Graphite’s ownership

In 2005 Tesla was sold to Bank of Scotland

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• In the three years of Graphite’s ownership U-POL expanded rapidly, significantly increasing its international presence
• The development of new products was accelerated and a range of new coatings successfully launched
• Graphite helped grow the business by strengthening the management team and financial focus
• EBITDA increased by 45 per cent during Graphite’s ownership

In 2006 U-POL was sold to AAC Capital Partners, generating a multiple of 3.2 times cost

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• Graphite invested at an early stage of Vardon’s development to fund growth largely through acquisition
• The company made three major acquisitions between 1992 and 1996, London and York Dungeons, Sea Life Centres and Parkdean Leisure, growing from nine to 19 centres
• Operating profit at London and York Dungeons doubled in the first four years of ownership
• Group operating profit grew from £2.4 million to £9.1 million during the period of Graphite’s ownership

In 1992 Vardon was listed on the London Stock Exchange

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• Graphite invested in the early stages of Wagamama’s development to fund the expansion of its chain of noodle restaurants
• Graphite brought in a strong, experienced management team which expanded the chain across the UK and through franchised restaurants abroad
• The number of restaurants grew from two to 50 during Graphite’s ownership 
• Turnover increased from £2.5 million to over £45 million and operating profit grew from £0.4 million to £5.7 million

In 2005 Wagamama was sold for £103 million to Lion Capital, generating an IRR of 37 per cent

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