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Private Equity and Recruitment Gary Tipper, Palatine Private Equity Ian Langley, Air Energi Group

Private Equity and Recruitment Gary Tipper, Palatine Private Equity Ian Langley, Air Energi Group. Palatine Private Equity . Independent private equity house, owned and controlled by the Partners Entrepreneurial team with over 50 years private equity experience

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Private Equity and Recruitment Gary Tipper, Palatine Private Equity Ian Langley, Air Energi Group

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  1. Private Equity and RecruitmentGary Tipper, Palatine Private EquityIan Langley, Air Energi Group

  2. Palatine Private Equity • Independent private equity house, owned and controlled by the Partners • Entrepreneurial team with over 50 years private equity experience • £100m maiden fund raised in 2007 fully invested in nine deals • £150m second Fund now raised and being invested • Equity investments from £10m to £25m • Offices in Manchester, London and Bristol • All deals led by the decision makers

  3. What is Private Equity ? • Medium to long term funding in return for an equity stake in a business • There are a lot of different private equity firms • Different fund sizes • Different types of deals • Different returns expectations • Typically private equity investors look at an investment period of 3 to 5 years • A shareholder relationship not just a source of funding

  4. What can private equity funding do ? • Management buyouts • Shareholder restructurings • Cash out / equity release • Fund acquisitions / buy and build strategy • Growth capital

  5. Why recruitment / staffing ? • Ability to dominate a sector and/or functional niche • Control of scarce resource • Potential for rapid organic growth • Drive scale • Sector and sub sector consolidation, acquisitions, buy and builds • International expansion • Low capex requirements

  6. Air Energi Group • AEG provides expertise to the energy industries. This includes contract, project and staff hire teams and individual engineers and technical persons together with full global compliance and logistical support services. • AEG places around 2,500 consultants/contractors on both upstream and downstream energy projects • Palatine backed the management buyout in August 2009 • Ian Langley, Chairman, led the deal • Provided an exit for some legacy shareholders • Enables other legacy share holders to realise some value from the business

  7. Air Energi Group – Post Deal • Appointed a independent Non Executive Director • Completed two acquisitions – PMG and Indonesia • Refinanced with HSBC $50M global facility • Broadened the global operating network – 25 offices • Grew profitability to more than £1-m at exti from £5m at entry • Completed a secondary buyout with LGV in October 2012 • An overall return of 3x cash in just over 3 years for PE and Legacy Shareholders • New Management shareholders saw a 10x+ return

  8. What do we look for ? • Quality management team, strength in depth • Well thought through and deliverable business plan • Businesses operating in a niche (functional or sector) • Scalable business • Good margins • Strong pipeline, good visibility of earnings

  9. Be prepared • Get your business in good shape for a transaction • Legal, compliance, paperwork in order • Banking • Insurance • Contracts • Tax • Alljurisdictions • Financials • P&L • Balance Sheet • Ebitda • Margins • Cashflows • Cost structure • Geographies

  10. Be prepared • Get good advisors • Corporate Finance Advisor (someone who understands your sector) • Accountant / Tax / Audit • Lawyer • People that you trust • Due diligence • Financial • Legal • Management assessment • Commercial/market • Deals and due diligence takes time • Meetings • Management time / long hours • There will be bumps along the way

  11. Be prepared • Do your own due diligence on potential funders • Speak to management teams they have backed • Speak to other advisors that have worked with them • Choosing the right funder is crucial • You’re going to work together for 3-5 years • Chemistry needs to work

  12. Summary • Private equity can be a good source of funding to accelerate growth • It is not something to be rushed into, consider properly and assess your options • Have a deliverable business plan • Be clear about what the funding is for and how it will be used • Be prepared, have the business ready • Do your own homework on potential funders

  13. Gary Tipper Managing Partner 0161 214 4730 gary.tipper@palatinepe.com Ian Langley Chairman 0870 112 9444 ilangley@airenergi.com

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