Funding boost will allow firm to deliver its orders
ASOUTH Wales firm, which is the UK’s leading player in the design and refurbishment of overhead electricity transmission lines, is poised for strong organic and acquisition fuelled growth after securing a multi-million-pound funding boost.
Voltcom Group, a principal contractor to the UK electricity transmission and distribution market, has secured new finance that includes an equity investment from Beechbrook Capital.
The funding, which also includes debt, will also provide Voltcom with the working capital to deliver on an impressive £100m plus order book.
The company, which is headquartered in Llantrisant with offices throughout the UK, employs more than 180 staff. It is a contractor to the UK’s major electricity distributors in the design, refurbishment and maintenance of low and high voltage overhead transmission lines.
In its last financial year to the end of September this year, it doubled its turnover to £22m. Sales next year are projected to exceed £40m.
Chairman Simon Pankhurst said: “I am very pleased that we have been able to conclude this deal with Beechbrook Capital. I got involved with this business because the team has developed an innovative delivery model that is aligned to our customers’ regulated targets, which require capital expenditure of over £20bn to improve the electricity infrastructure over the next six years.
“With Beechbrook as our new partner, we have the capital base to underpin our order book and future prospects in this growing market. A great future is ahead of us.”
The company is also exploring moving into international markets, as well as strategic bolt on acquisitions.
Peter Kirtley as investment director led the team at Beechbrook Capital, assisted by Emily Collins and Elliot Gargan, on the firm’s investment into Voltcom. Beechbrook Capital will also be providing Voltcom with additional finance for targeted strategic acquisitions.
Voltcom on turnover definition has moved from being an SME to a mid-sized company.
The company’s other funders include HSBC and Finance Wales [which is now trading as the Development Bank of Wales], which also remains a shareholder.
The value of the total funding package has not been disclosed, but is believed to be in the region of £10m.
Voltcom’s managing director, Mark Wright, said: “Our success in converting to a principal contractor was always anticipated to require significant working capital, a barrier in itself to this transition for other operators.
“Our valued customers expectations need to be fulfilled to the highest standards and we are now in a position to continue to provide engineering and project management to the level expected of a principal contractor.”
The funding was sourced by the Gambit Corporate Finance team of Tim Brotherton, Sam Forman and led by partner, Frank Holmes. Legal support was provided by Hugh James Solicitors, led by partner Greg Williams.
Mr Williams said: “We were pleased to advise Voltcom on this strategically important investment which allows Voltcom to capitalise on the opportunities in its marketplace going forward. We have worked with Voltcom over the past few years on its investments and look forward to seeing the next stage of its growth.”
Mr Holmes said: “Voltcom is a perfect example of the potential for Welsh companies aiming to grow into sizeable businesses with broad geographical reach and led by tenacious management.
“The company’s key drawback was funding as it had the order book, blue chip customers, technical capability and leadership necessary to fulfil its plan.
“We are pleased to have worked with Mark and the team to secure the most appropriate funding package and new partner for this exciting journey. Moreover, for Wales this sits well with the overdue recent economic focus to support bigger business.”
> Voltcom Group, which has its headquarters in Llantrisant, has secured new finance, including an equity investment from Beechbrook Capital