Arbuthnot Commercial ABL supports vendor-financed MBO of SafeGroup with a £4.5m funding line

The total funding package includes a £2m receivables financing line, a £1m cashflow loan, and a £1.5m RLS term loan.

Martin Gammon, Chairman, and Oliver Hewett, Finance Director of SafeGroup, led the transaction, which provided funding in support of the partial share purchase consideration and additional headroom for growth. The deal will allow the founder and CEO, Steve Broughton, to realise some value and free up equity to generate a greater incentive for the existing management team and attract new senior hires.

SafeGroup provides reactive cleaning and waste services, which involves responding to short-turnaround requests for a range of blue-chip clients. During the pandemic, the business expanded its range of solutions to meet rising customer demand for specialist infection control and decontamination services.

Oliver Hewett, Finance Director at SafeGroup Services Limited, said:

"We are on an exciting entrepreneurial journey driven by customer-focused innovation. With the new funding in place, we plan to double the size of the business in the next three years and aim to further extend our geographical reach throughout the UK. We view Arbuthnot Commercial ABL as a supportive funding partner in helping us achieve our strategic growth objectives. Having conducted a number of transactions in the past that have been subject to a shift in some way, we greatly appreciated the consistency of Arbuthnot’s approach and the fact that they delivered precisely what they said they would."

Andrew Rutherford, Commercial Director at Arbuthnot Commercial ABL, said:

“This is a great opportunity to partner with an innovative, independent business in a regionally fragmented sector, with a clear vision, an experienced team and a strong platform for growth. We have supported several ‘sponsor-less’ MBOs recently, and it is interesting to see transactions of this kind become a regular feature of the UK M&A landscape alongside private equity sponsored transactions, which together are fuelling a buoyant management buyout market.”