13.09.2006

Barclays Private Equity Buys in to AFI-UpLift

Details of the merger agreed earlier this week between AFI and UpLift have now been announced. The deal was made possible by a £15 million investment from Barclays Private Equity in the merged business.

Barclays and AFI-UpLift declined to comment on what shareholding Barclays will hold in the company, although Barclays says it is significant, or on the level of equity being retained by Nick Higgins and Ruairi Duggan, owners of UpLift, both of whom will sit on the AFI-Uplift board.

As we reported earlier this week, the new business will be the second largest powered access rental company in the UK, with a fleet of over 3,200 lifts and 200 employees. See AFI to merge with UpLift

Barclays Private Equity investment director Steve O’Hare, who will also join the AFI-UpLift board as a non-executive director, said: “We are delighted to be supporting the merger of these successful businesses. We are backing the leading management team in a fast growing niche of the UK plant hire market. We believe future consolidation opportunities exist to accelerate our growth.”

Nick Selley of AFI, who has been appointed as corporate development director for the merged business, said: “The merger of AFI and Uplift is a further tangible demonstration of our confidence in the future of the UK powered access rental sector as a whole. We feel that there remain significant opportunities for growth, especially as a result of the new Work At Height regulations and the resultant need for safer methods of access. We are experiencing strong levels of demand.”

“Uplift is a strong player in the Northern powered access rental market and a business that we admire. This joining together of the two companies will enable us to build a stronger, enlarged business. We are also pleased that Barclays Private Equity has come on board to support this significant expansion.”

AFI has grown rapidly since David Shipman and Geoff Gibson bought into the business after their departure from market leader Nationwide Access. Earlier this year the company acquired Watford based Alan Drew.

The Wakefield and Haydock branches of UpLift will join the AFI locations in Birmingham, East Midlands, Hull, Liverpool, London East, London South, London West, Manchester, Milton Keynes, North East, Peterborough, South Wales, Southampton, South West and Wakefield.

Vertikal Comment

We commented earlier this week on the fact that this deal brings more entrepreneurial talent in to AFI and gives Nick Higgins and Ruairi Duggan the chance to cash out on the effort they have put in over the last five years, while having the chance to work in a larger organisation which still retains an entrepreneurial spirit.

AFI has been driven in recent years by its desire to close the gap on Nationwide Access, that gap was opened up earlier this year by Lavendon’s spate of acquisitions of regional UK players, Panther, AMP and Kestrel. Barclays clearly has an appetite for the UK rental business and appear to be ready to fund further AFI acquisitions.

With two companies in the UK now apparently keen and able to 'consolidate' the UK powered access rental industry through local acquisitions, the next year or two may prove to be the most lucrative time for locally owned businesses to sell out.

From another angle, the fact that an increasing portion of access rental market is in the hands of professionally managed companies that are obliged to lay out and plan coherent marketing strategies and make a decent return on their capital, must be good news for well managed local companies.