The private equity backer of a leading school uniform supplier is seeking to sell its stake in the organisation, EducationInvestor Global can reveal.
This publication has learnt that MML Capital Partners has drafted in advisors from GCA Altium to find a buyer for its controlling stake in Banner, one of the UK’s largest school uniform providers.
Sources said that an extended teaser for Banner puts its revenue at around £60 million and earnings before interest, tax, depreciation and amortisation (EBITDA) at approximately £9 million.
Headquartered in Wiltshire, England, Banner has wholesale and retail operations, with the latter division encompassing 17 shops and 14 in-school stores. It also has a webstore and supplies third-party companies, such as Marks & Spencer, with schoolwear and sportswear. Banner’s main competitor in the UK is Trutex, which is owned by its management team.
MML bankrolled a management buyout of Banner in 2015, when the organisation traded as Blue Max Banner. This transaction saw MML become a majority shareholder in the business through Roman Bidco Ltd, a holding company it established.
Since MML’s capital infusion nearly six years ago, Banner has acquired two companies – sportswear provider Orion and SWI Schoolwear – both of which were taken over in 2016.
Banner is headed up by chief executive Glenn Leech, who succeeded Banner’s former leader, managing director Nigel Plenderleith, in 2017 following his retirement. Leech was formerly managing director of Connect Education & Care, a £65 million-turnover retail distribution business geared at schools, nurseries and care homes in the UK and overseas.
The teaser compiled by GCA Altium states that the next step in Banner’s strategy will involve internationalising the business to expand its share of an addressable market that was last year worth £555 million, according to consultancy EY-Parthenon, whose statistics are referenced in the prospectus.
A corporate finance source familiar with business told this publication, on the condition of anonymity, that Banner’s enterprise value “will be driven by the debt process” – in other words, by the amount of leverage accessible to the new investor. There are “big working capital needs”, the person added.
GCA Altium has also been picked by mid-market buyout group ECI Partners to steer the sale of school software provider CPOMS – as revealed by EducationInvestor Global in March – which is expected to come to market later this year.
MML used to own a stake in apprenticeship provider Learning Curve Group, which was acquired by Agiliitas Private Equity last March in a deal worth £100 million, as revealed by EducationInvestor Global.
MML and GCA Altium did not respond to requests for comment.
Date published: 21 May 2021