< Previous East Midlands Business Link www.eastmidlandsbusinesslink.co.uk FINANCE NEWS Midlands private equity activity falls significantly in 2023 from two year high Buyout activity across the Midlands private equity industry dropped markedly in 2023, with the pendulum swinging back from the record activity levels seen in the aftermath of the post-COVID period, according to provisional full-year data from CMBOR at Nottingham University Business School and supported by Equistone Partners Europe. The 28 buyouts completed in 2023, with a cumulative value of £1.2bn, represent a dramatic fall from the two highest annual values of the post-2008 period, with deals worth £5.9bn completed in 2022 and deals worth £6.1bn in 2021. This sense of an industry-wide pause is underlined by cumulative deal value not surpassing £2bn for only the third time in the last ten years and is a similar theme to that seen across the UK and Europe. The decline in deal activity started in H2-2022 and continued into H1-2023, where just £0.1bn worth of deals were completed in the first six months of the year. The downward trend reversed in H2-2023 with £1.1bn worth of deals completing, providing encouragement for the year ahead. Subsidence specialist secures seven-figure loan to support acquisitions A Midlands-based business which specialises in subsidence monitoring has secured a seven-figure debt funding package from Frontier Development Capital (FDC) to support its acquisition plans. SML Group has already acquired and successfully integrated six businesses in the past 10 years and now employs 160 staff at its headquarters in Leicester and its offices in Edinburgh, Peterborough, Norfolk, Swansea and Arundel, Sussex. The group operates through a range of brands including My Home Needs, Subsidence Monitoring, Geo Info, Landmark Surveys, Ratcliff Land Surveys, Drillline GPR and The Survey Store. In addition to subsidence monitoring for loss adjusters and insurers, it provides geo-spatial surveys and geo-technical services including materials testing and inspection to the construction industry. SML Group has doubled its turnover in the past 18 months to £12m and aims to continue this rapid growth in the next five years through a combination of organic growth and acquisitions. The business was founded in 2007 by subsidence specialist Thomas Harpin in response to the growing demand for monitoring services. Nottingham tram future secured by operator through financial restructuring Tramlink, which operates Nottingham Express Transit (NET), has completed a financial restructuring project which has secured the future of the network for the next ten years. The news follows the successful renegotiation of loan terms from lenders, and was necessary to avoid further and ongoing breaches of banking covenants. It puts the concession, which allows Tramlink to run the NET tram system, in a stable position to move forward, following significant market changes. The network is still feeling the effects of the pandemic, with passenger figures remaining around 80% of pre-COVID levels. Meanwhile, the impact of rising electricity costs as well as a period of sustained hyper-inflation are all contributing towards a changing market dynamic. However, the move will ensure NET can continue to offer a green, convenient and affordable way to travel. The deal will also allow the team to focus on improvements including investment in new technology, more revenue protection officers and updates to ticketing systems. It will also allow them to look to the future with possible network expansions. © stock.adobe.com/fizkes Tom Harpin of SML Group, left, with Charlie Robinson of Frontier Development Capital FINANCE NEWS www.eastmidlandsbusinesslink.co.uk East Midlands Business Link Nottingham firm acquired by education recruitment specialist Operam Education Group – the BGF-backed education recruitment specialist – has completed its first acquisition in the further education (FE) sector in the latest in a series of strategic acquisitions. The company has acquired Nottingham-based Provision Recruitment for an undisclosed sum in a deal supported by HSBC and BGF. Founded in 2004, Provision Recruitment has built up a strong reputation in the FE sector, supporting colleges with the recruitment of lecturers. It is the third Midlands- based acquisition by Operam, joining Teachers UK and First for Education. Operam CEO Eddie Austin said: “Traditionally, the business has focused on mainstream and SEND education, as part our buy-and-build growth ambitions. This is our first acquisition in the further education sector which enables us to broaden our reach, both from a geographical and sector perspective, integrating a well- established businesses into the group that has real potential to scale across different locations in the UK.” Game development studio acquired for £76.5m Keywords Studios, the international provider of creative and technology-enabled solutions to the global video games and entertainment industries, has acquired The Multiplayer Group Ltd (MPG), a multiplayer focused game development studio headquartered in Nottingham, for £76.5 million. The Group has acquired the business from Improbable, the metaverse company, which has owned MPG since 2019. MPG is one of the largest and most respected developers of AAA multiplayer games and technology for some of the world’s best- known studios and publishers including Activision Blizzard, Bethesda, Zenimax, Epic and 2K. MPG provides a range of services including both co-development and full game development to a global client base, and also has functions working on data science, new technology and AI. The business has grown rapidly since its foundation in 2018 and now employs over 360 staff globally. MPG’s leadership team comprising Andy Norman, Rocco Loscalzo, Vaughan O’Brien and Roger Cheung will continue to lead the business post-acquisition and will participate in a management incentive plan based on ambitious growth targets over the next two years. © stock.adobe.com/ issaronow £15.6m development loan secured for 293-bed Lincoln student scheme Moorfield Group, a real estate fund manager, has secured a £15.6 million facility from Investec Real Estate to fund the development of a 293-bed purpose-built student accommodation (PBSA) campus in Lincoln. The development is already under construction and due to complete ahead of the 2024/25 academic year. Comprising four three-storey townhouses and a further five four-storey buildings, features will include an on-site reception and laundry facilities. This is Investec’s second student deal with Moorfield, having previously provided an £18.97 million loan for the development of a 282-bed PBSA scheme in Colchester. Charles Ferguson Davie, Chief Investment Officer at Moorfield Group, said: “We have been investing in student housing for over twenty years and investor confidence in the sector remains resilient, with domestic and international investors keen to increase their exposure to an undersupplied asset class offering risk-adjusted returns and long-term income streams.” Eddie Austin © stock.adobe.com/ cherryandbeesAdministrators appointed to plant-based meat and cheese manufacturer James Clark and Howard Smith from Interpath Advisory have been appointed joint administrators to VBites Foods Limited. Founded in 1993, VBites is a manufacturer and wholesaler of plant-based meat and cheese. The company operates from two manufacturing sites in Peterlee, County Durham, and Corby, Northamptonshire. The company had recently seen increased pressure on cashflow due to the impact of rising raw material costs and energy prices, as well as a softening of consumer demand for alternative protein products in the wake of the cost-of- living crisis. The directors sought to explore their options, including making attempts to secure additional funding. Unfortunately, however, a funding agreement was unable to be reached. 29 members of staff based at the Peterlee site have been retained by the joint administrators to assist them with trading. The joint administrators have also retained 25 employees at the site in Corby to assist with the fulfilment of outstanding orders. However, 24 employees across the business have been made redundant. East Midlands Business Link www.eastmidlandsbusinesslink.co.uk MANUFACTURING NEWS East Midlands manufacturers see anaemic picture as they end the year East Midlands manufacturers saw an anaemic picture as they ended 2023, but business confidence indicators are showing promising signs of a more stable economic environment after the global and domestic uncertainty of the last few years. However, while Make UK upgraded its growth forecast for manufacturing in 2023 to +0.8% it is forecasting growth in 2024 of just +0.1%. This reflects the weak economic picture for the UK overall and weak growth in the Eurozone which remains the UK’s biggest market. The findings come in the Q4 Manufacturing Outlook survey published by Make UK and business advisory firm BDO. According to the survey, output in the East Midlands weakened towards the end of the year from a balance of +12% in Q3 to zero in the final quarter. Both export and domestic orders are weak reflecting the fragility in the UK’s major markets, with little sign of a pick up in the first quarter of 2024. This picture is reflected in recruitment plans being put on hold while investment intentions have turned negative. Engineering firm targets carbon neutrality with £1.3m investment An East Midlands manufacturer is driving sustainable growth, supported by a £1.3 million investment from Lloyds Bank. Headquartered in Desborough, Northamptonshire, OKAY Engineering designs and manufactures high performance recycling equipment and waste handling technology. OKAY plans to become fully carbon neutral within 10 years. Thanks to £187,000 of funding, the £9 million turnover business has just boosted its green credentials by installing 425 solar panels on its factory roof. The 200MWh system now provides two thirds of the company’s energy demand, reducing energy bills by £1m over the panels’ 25-year lifetime. The new measures will also save 40 tonnes of CO2 production each year, the equivalent of planting 1,728 trees. OKAY has also purchased three acres of brownfield land behind its current factory. The plan is to use one acre of the adjacent site to build a second factory to serve demand from the rapidly growing recycling industry, and the remaining two acres is earmarked for a solar farm so the company can become entirely energy self- sufficient. © stock.adobe.com/ wi6995 © stock.adobe.com/ aamulyaCMA gives go-ahead to Alumasc’s acquisition of ARP Group The UK Competition and Markets Authority (CMA) has formally issued unconditional clearance in relation to Alumasc’s acquisition of ARP Group. Paul Hooper, Chief Executive of Alumasc, said: “This acquisition aligns with our strategy to accelerate our organic growth with earnings enhancing bolt-on acquisitions, and we are delighted that it has cleared its final regulatory hurdle. “We are excited about the scaling up opportunities this transaction brings to both companies and look forward to welcoming the ARP team into Alumasc Group.” The Kettering-based sustainable building products, systems and solutions group revealed the £10m deal for Leicester-based ARP Group, a manufacturer and distributor of specialist metal rainwater and architectural aluminium goods, in July. www.eastmidlandsbusinesslink.co.uk East Midlands Business Link MANUFACTURING NEWS Engineering consultancy snaps up Burton firm Burton-based Lorien Engineering Solutions, a division of GP Strategies Corporation, has been acquired by engineering consultancy NIRAS. The deal accelerates NIRAS’ growth ambitions within the global food & beverage and life science sectors and strengthens the company’s market position within process industry. Senior Vice President, NIRAS, Thomas B. Olsen said: “Lorien Engineering Solutions and NIRAS are a strong fit in terms of expertise, scale, clients and markets. “With this integration, we can grow and develop Lorien Engineering Solutions’ services as part of our core business to solidify our position in the food & beverage and life science industries and expand the offering for our clients throughout and globally.” Lorien Engineering Solutions is a full-range provider of engineering consultancy services ranging from conceptual and predesign through to project management and commissioning within the food & beverage, life science, and advanced manufacturing industries. They also provide compliance and energy optimisation services to clients worldwide. In joining NIRAS, Lorien Engineering Solutions becomes part of a multi-disciplinary engineering consultancy with more than 2,800 employees. Rolls-Royce reaches agreement-in- principle with Deutz AG to take over lower-power-range engines business Rolls-Royce and Deutz AG are in positive discussions for the sale of the off-highway engines business in the lower power range up to 480 kW to Deutz AG for a price in the high double-digit million Euros. This relates to diesel engines and engine systems using Daimler technology which are developed and manufactured by Daimler Truck AG for Rolls-Royce Power Systems to its specifications and used mainly in agricultural vehicles and construction machinery, not in rolling stock or in military vehicles. Rolls-Royce recently presented its strategy to become a high performing, competitive, resilient and growing business to investors. In the Power Systems division the focus will be on the strategic growth areas of power generation, governmental, marine, service and the future field of battery energy storage systems. Tufan Erginbilgic, CEO, Rolls-Royce plc, said: “This is a clear illustration of our strategy in action. Becoming more focused on the markets where we know Rolls-Royce can win.” Image courtesy of Rolls-Royce © stock.adobe.com/ 9dreamstudio Tufan Erginbilgic © stock.adobe.com/ AscannioPROPERTY NEWS Planning and listed building consent granted for former Bennetts store in Derby Manston Investments Ltd has obtained planning and listed building consent to repurpose its property at 8-9 Iron Gate in the heart of Derby city centre. The property, still known to many as ‘the former Bennetts Department store’, became vacant just before the first Covid lockdown when the former business went into administration. With the help of a local team comprising architects JSA Consulting, cost consultants Armsons Barlow, and Heritage Planners Urban Fabric, the approved scheme will provide a range of accommodation. Partial demolition at the rear of number 8 will allow for secondary access and a goods receiving area. Internally, the former large single occupier space will be divided to cater for a variety of independent uses. The approved plans show two smaller independent ground floor units fronting Iron Gate and suited to retail, food and beverage or other leisure uses. There will be an independent suite of offices to the rear, and a first floor with potential for open plan or serviced office use. The upper floors show eight residential units. Practical completion reached for major new Nottingham logistics scheme Construction of a significant new logistics facility in Nottingham has reached practical completion, delivering 362,289 sq ft of warehouse and distribution space. The development has been funded by Barwood Capital’s Regional Property Growth Fund IV and delivered in partnership with Premcor Estates. Situated just five minutes from Junction 26 of the M1 motorway, Nottingham 360 is a high-bay logistics / production facility with a warehouse on the ground floor of 329,415 sq ft and additional office space of 32,874 sq ft, which includes a hub office to the service yard. “Nottingham 360 is ideally located in the heart of the UK road network with good accessibility to the M1 motorway and strong employment demographics. With a key focus on ESG, the development has achieved BREEAM Excellent, Net Zero in construction and is Net Zero in operation enabled,” said Adam Smith, asset management director at Barwood Capital. East Midlands Business Link www.eastmidlandsbusinesslink.co.uk Leicester leisure park sold for £25m Legal & General Investment Management (LGIM) has sold Meridian Leisure Park in Leicester to Greenridge Opportunities LP for £25 million reflecting a yield of 8.50%. Montagu Evans advised the seller and Savills advised the buyer in this off- market transaction. The East Midlands destination leisure park extends to 155,071 sq ft GIA across a 19.8-acre site southwest of Leicester City Centre, directly off the Leicester Ring Road (A563) and 1.5 miles from the M1 (J21). It is anchored by Vue Cinemas and Hollywood Bowl, with other occupiers including David Lloyd, Nando’s, Five Guys, Burger King, Pizza Hut and Frankie & Benny’s. It has been owned by LGIM’s Leisure Fund since 2002, with a number of new leases and regears undertaken during this time. The park is 99% let with over half the income benefitting from rental indexation or fixed uplifts and a term certain of approximately 12 years. PROPERTY NEWS Green light for residential scheme in Derwent Valley Mills UNESCO World Heritage Site Wavensmere Homes has received the green light from Amber Valley Borough Council for its revised plans for the redevelopment of Milford Mills, which overlooks the River Derwent, located between Belper and Duffield in north Derbyshire. 69 new homes will now be delivered on the historic site, which is within the Derwent Valley Mills UNESCO World Heritage Site. Accessed off Derby Road (A6) in the centre of Milford village, the redevelopment of former commercial premises will feature 42 two- and three-bedroom houses and 27 one- and two-bedroom apartments, within a four-storey building overlooking the River and Mill Lade. The houses will be installed with air source heat pumps, while the apartments will have electric heating, with solar PV panels fitted to the roof of the building to generate renewable energy. Dating back to 1780, Milford Mills is a former cotton mill which housed some of the world’s first mechanised industrial spinning factories. The highly unique project will see the retention and restoration of numerous historic features from the former cotton mill. 122 affordable homes set for Sleaford brownfield site Countryside Partnerships, the provider of multi-tenure, affordable homes, has exchanged contracts with Tesco Stores Ltd on a 12.8-acre brownfield site in Sleaford, Lincolnshire with a view to building 122 new affordable homes, 5 First Homes and a 66- bed care home. They will also be providing a new county standard bowls green and club house to replace the ageing facilities currently on site. The regeneration project will transform the former industrial site, previously used for seed processing, into much-needed housing with a mix of two-, three- and four- bedroom family homes for the area. The First Homes are market-sale properties discounted by at least 30% and available to first-time buyers meeting certain eligibility criteria. The land is allocated for mixed-use and residential development in the Lincolnshire Local Plan, adopted in April 2023. Countryside now expects to submit a Reserved Matters planning application in the first half of 2024 with a view to starting work later in the year. Senior living specialist submits plans for care home in Leicestershire Plans have been submitted by senior living developer Charterpoint for a 72-bedroom care home in Markfield in north west Leicestershire. The detailed proposals are for land to the north of Leicester Road. They include plans for a mainly two-storey, modern care home, which also features en-suite bathrooms to each bedroom, residents’ lounge and dining areas, a café/bar, plus activity areas. The proposals also include 34 car parking spaces, along with terraces, patios and landscaped gardens. The plans have been submitted to Charnwood Borough and Hinckley and Bosworth Borough Councils following a public consultation process. MD of Charterpoint, Giles Nursey, said: “We have established that there is a need for a modern, purpose-built care home to meet the needs of older people in the Markfield area of Leicestershire. “In preparing our scheme we have sought to provide a high quality, modern and neighbourly development that sits within the existing landscape, maintaining and enhancing the existing boundary hedgerow along Leicester Road.” www.eastmidlandsbusinesslink.co.uk East Midlands Business Link East Midlands Business Link www.eastmidlandsbusinesslink.co.uk DE MONTFORT UNIVERSITY Q&A Are apprenticeships only for big corporations? Not at all. Funding is available for businesses of all sizes including SMEs with the Government offering different financial incentives and grants to help smaller firms. Large companies with a wage bill of £3million or more pay into the Apprenticeship Levy, a national funding pot. Each company paying in has its own apprenticeship service account, and can use the funding to pay for apprenticeships in its business. Smaller companies can access 95% of funding towards the cost of an apprenticeship from the Government, and it pays 5% of the cost. However, if you have fewer than 50 employees you will be eligible for 100% funding from the Government if you take on an apprentice aged 16-18, or 19-24 if they have an Education, Health and Care (EHC) plan or have been in care. Aren’t apprenticeships only for specific industries? You can go down the vocational route, but there are apprenticeships for senior managers, data analysts, cyber security experts – there are so many options to choose from. Also it’s worth knowing that many providers will work with you to tailor the programmes to suit the needs of businesses sending their staff onto the courses. At DMU we work with companies of all sizes and work with them to tailor content and topics to make it as relevant as possible for staff. Q&A De Montfort University Apprenticeships are a great way of improving the skills of your team and for a small business they can offer a route to accessing new talent or developing existing staff. But there are many misconceptions about apprenticeships, particularly around how the funding works. Dr Danny Buckley, senior lecturer in enterprise at De Montfort University Leicester (DMU), separates apprenticeship facts from fiction in this month’s Q&A.www.eastmidlandsbusinesslink.co.uk East Midlands Business Link DE MONTFORT UNIVERSITY Q&A Interested in apprenticeships? Contact us: apprenticeships@dmu.ac.uk to have a chat or email us with any questions Won’t an apprenticeship programme be disruptive to my business? Apprenticeships are designed to be flexible and accommodate the needs of businesses. With proper planning, businesses can integrate apprenticeship programs seamlessly into their operations. All you need is someone to manage and mentor a new recruit or existing staff member, and if you have that, you are big enough to benefit from an apprentice. Many training providers such as DMU work closely with employers to create schedules that minimize disruption. In the long run, the skills gained by apprentices can contribute to increased productivity and efficiency within the company. Is apprenticeship funding only for new hires? The myth is that apprenticeships are only for young people and school leavers, that funding is only applicable when hiring new employees, not for upskilling existing staff. The reality is that apprenticeships are available for both new hires and existing employees. Small businesses can use apprenticeship programs to upskill their current workforce, ensuring that employees stay relevant in rapidly evolving industries. This dual-purpose approach allows businesses to address skill gaps and invest in the professional development of their staff. Can apprenticeship programs really address the skills gap in my industry? The simple answer here is yes. Apprenticeship programmes are a powerful tool for closing the skills gap, especially for small businesses. In my area, which is leadership and management, we find that many people who come onto the programme have been in managerial roles but have never had formal training. Giving them that academic, theoretical know how to add to what they already know from doing their day job can make a huge difference to their confidence and capabilities. East Midlands Business Link www.eastmidlandsbusinesslink.co.uk COMMERCIAL PROPERTY Business Link reflects on major East Midlands property milestones from the last month. Citra Living is to bring 95 new apartments to Nottingham’s private rental market as work commences on the redevelopment of the iconic British Waterways building. www.eastmidlandsbusinesslink.co.uk East Midlands Business Link COMMERCIAL PROPERTY S ignificant developments are cropping up throughout the East Midlands, and the past month has seen key milestones achieved for many, showcasing the attractiveness of the region to investors. Derby has hit headlines with its new £45.8m entertainment and conference venue taking a step forward as the auditorium starts to take shape. Only five months after main contractors Bowmer + Kirkland moved on site, the steelwork alongside rows of concrete steps which will become a tiered seating area is clearly visible, and an overhead steel gantry containing 200 tonnes of steelwork for lighting and other technical equipment is being constructed. Further steel beams are also set to be fitted to create the roof, ready for the concrete pour in early 2024. This will be followed by a layer of insulation, plasterboard and quilting to make sure the building is soundproofed. Expected to host over 200 cultural and commercial events each year, the 3,500 capacity venue is to attract an additional 250,000 visitors to Derby, create over 200 new local jobs, and increase levels of investment in surrounding areas of the city centre. Practical completion and handover are scheduled for the first quarter of 2025. The new venue forms the second phase of the £200m Becketwell regeneration scheme, with phase one, including The Condor - the city’s first purpose-built Build to Rent scheme - now open, owned and operated by Grainger plc, along with Springwell Square, a new public square for the city, which officially opened in September. The scheme is being developed by St James Securities, a privately-owned Leeds-based property developer. Remaining in Derby, demolition has begun ahead of the next round of construction at Castleward. Site preparation works for phase four – the penultimate phase – of the major city- centre regeneration scheme will make way for construction work to begin in 2024. Site preparation works involve the demolition of the former Derbyshire County Transport and Tarmac sites that Derby’s new £45.8m entertainment and conference venue has taken a step forward as the auditorium starts to take shape. 20 ÁNext >