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ABN AMRO Capital leads 116m secondary buyout of Jessops - ABN AMRO Capital leads 116 mln secondary buyout of Jessops Limited - the UK's leading photographic retailer - from Bridgepoint Capital.
The UK based team of ABN AMRO Capital, today announced that it has exchanged contracts for the secondary buyout of Jessops Limited from private equity firm, Bridgepoint Capital. The value of this transaction is 116 million. The transaction, which is conditional only on clearance by the European Competition authorities, is expected to be completed no later than 31st October 2002.
Jessops is one of the fastest growing retailers in the country, operating in one of the highest growth segments of the retail industry - digital cameras. Sales of digital products will have increased by 47% in the year to 30 September 2002. The number of stores operated by Jessops in the UK in the last five years has more than tripled, to a total of 236. In the three years to 30 September 2002, the company will have increased sales by 94% to 242m and EBIT by 73% to 13.3m.
Jessops intends to open a further 26 stores in the UK in the next two years, and, if attractive opportunities are available, to expand into Continental Europe, where significant potential exists in currently fragmented markets. Jessops was also the first retailer to offer digital developing and printing (D&P). By the end of 2002 it plans to be able to offer digital D&P services in all its stores.
The UK photo imaging market has grown to 2.1 billion over the last five years. This growth has been fuelled by increased sales of digital products and digital accessories, offset by a decline in the sales of conventional products.
The management team has extensive retail experience. It has grown the business and led the development of the digital market, over the last few years. It is lead by Derek Hine, the Chief Executive, and John Crabtree, the Finance Director. Tim Brookes, will remain with the Group as non-executive chairman. Simon Tuttle and Dominic Collier of ABN AMRO will also join the Board on Completion.
Jessops will be jointly owned by management and funds managed by ABN AMRO Capital. Jonathan Bourn, Dominic Collier, Paul Southwell and Simon Tuttle coordinated the investment on behalf of ABN AMRO Capital.
HSBC, the Group's existing bankers, have arranged and underwritten the acquisition and working capital facilities.
Derek Hine, Chief Executive of Jessops said:
"ABN AMRO Capital shares our vision for the development of Jessops. We chose to work with ABN AMRO because they bring more than just investment to our company. They have an extensive understanding of the retail sector.
We look forward to developing the Jessops brand and to taking advantage of continuing growth opportunities in the digital camera market. Over the next few years we intend to focus on expansion: expansion into the digital market and into Europe, continuation of our store roll-out programme and development of digital printing services will be our main priorities."
Ian Taylor, Managing Director at ABN AMRO Capital, commented:
"Jessops is the leading photographic retailer in the UK, boasting a strong market share, an extensive product range, excellent relationships with key suppliers, and a strong management team. This is a great opportunity for us to invest in a first class business with high growth potential. We look forward to working with the team on building Jessops to become an even bigger player in the UK and Europe.
This deal also represents a major milestone for ABN AMRO Capital as it is our tenth investment since we entered the leveraged buyout market in early 2000. We have now invested in businesses with a total value of in excess of 1.3billion in that time."
Raoul Hughes, a director of Bridgepoint Capital said:
"The buyout by ABN AMRO Capital gives Jessops' management and staff the opportunity to continue building a very good business which has consistently traded ahead of expectations during its time with Bridgepoint. This has been a highly successful investment for us and we expect the business to continue to prosper with its new backers."