Businesses in Wales Backed for expansion
Here we feature the latest equity investments news in Wales
AMONMOUTHSHIRE veterinary practice has become the first in Wales to become an employee-owned business.
Archway Veterinary Centre, which has branches in Chepstow and Caldicot, is now owned by its 26 staff through an employee ownership trust (EOT).
Andrea Reynolds, who has been one of the directors of the business since 2011 – taking over sole interest in the small animal practice in 2014 – has sold her interest in the business.
The value of the deal has not been disclosed. Ms Reynolds will remain at Archway as one of three clinical directors, while there are also three trustee directors, including John McEwan, who originally established the practice, before retiring.
Ms Reynolds who graduated as a vet in 1996 and worked around the UK and Australia before settling in Chepstow, said: “In south Wales a large number of veterinary practices have been taken over by corporates and I was becoming increasingly concerned that a monopoly of these companies and private equity firms buying out small independent practices was affecting our industry, and those linked with it.
“Therefore, when I was considering the future of the practice, I was adamant that Archway would and should remain independent long after my stewardship ends.
“I have always been aware that the success of a veterinary practice depends on all of the staff who work there, and I believe the employee ownership model recognises and rewards each staff member’s contribution and gives them a voice in the future of the business. ”
She was advised on the transition by Social Business Wales, which is delivered by Cwmpas, the new name for the Wales Co-operative Centre. Capital Law acted on behalf of the company on the EOT.
Derek Walker, outgoing chief executive of Cwmpas, which delivers Social Business Wales, said: “Succession planning is a very difficult thing to navigate and Andrea has recognised that by selling her practice to her colleagues via an EOT means that her beloved business will remain independent and that she can also remain working there.”
Newly appointed director at Archway Veterinary Centre Eleanor Gough said: “Our team is unreservedly dedicated to promoting animal health and welfare. Becoming an EOT has meant we are able to stay true to ourselves and to protect the core ethos of our practice for years to come.”
Finalrentals
Global online car rental software venture Finalrentals has secured a six-figure equity investment to support its growth plans.
The Penarth-based start-up has been backed by a syndicate of four business angels led by lead investor Eamon Tuhami and venture capital company Fuel Ventures.
The investment has been matched by the Development Bank of Wales through its Wales Angel Co-Investment Fund.
Based at Tec Marin, Finalrentals is the brainchild of Ammar Akhtar, who is originally from Pakistan but relocated to the UK from Poland with an Innovator Visa as part of the UK Government’s Global Entrepreneur Programme.
He then took part in FinTech Wales’ Foundry – the no-equity accelerator programme that provides mentorship and support to help incubate, accelerate and scale start-up businesses in Wales. With a background in technology building car rental software and websites, Ammar established Finalrentals in Dubai in 2019. Employing a team of eight, half of whom are female, its innovative car rental platform is now used by local car rental businesses throughout the world including Canada, the United States of America and United Arab Emirates.
Mr Akhtar said: “From Pakistan to Dubai then Poland to Cardiff, this has been a three-year journey that started in my home garage, fondly known as the ‘Gar-Office.’
“Over half of the global car rental industry is made up of local car rental companies who are great at customer service but know little about e-commerce. I knew from my experience of working for companies like Thrifty, Dollar and Payless that there was a great opportunity to develop an innovative car rental platform that could be accessible to local providers.
“There is certainly a culture of innovation and growth in Wales and I’m now proud to call Cardiff my home.”
IQ Endoscopes
Medical devices firm IQ Endoscopes has secured a £5.2m equity investment to support expansion plans.
The investment into the Chepstow-based firm has been led by BGF (previously known as the Business Growth Fund) with existing investor Development Bank of Wales also participating in the round alongside a consortium of investors.
IQ Endoscopes has created a sustainable and single-use endoscopy device.
The company was recently supported with a grant from Cardiff and Vale Health Board, and received backing from the Cardiff Capital Region Challenge Fund to create a new recycling strategy for the product.
IQ Endoscopes’ technology leverages the complementary experience of its founders – Dr Patrick Ward-Booth brings over 40 years of clinical experience in the endoscopy field, while chief technology officer Andrew Miller has a background in automotive engineering that has been applied to the design and manufacturing of the company’s products.
The business, which was launched in 2017 has raised £5.9m to date, with seed funding and subsequent investment raised from investors including the Development Bank of
Wales. IQ Endoscopes has undergone rapid acceleration over the last five years and funds from this latest round will be focused on market access strategy ahead of product launch.
Matt Ginn, chief executive at IQ Endoscopes, said: “Single-use endoscopes not only eliminate all threat of cross-contamination between procedures, but also increase throughput of patients and allow greater access to treatment on a global scale.
“This latest financial backing will allow us to bring our disruptive technology to market, making it available to patients undergoing vital treat
ments and procedures as soon as possible.”
Tim Rea, investor at BGF, said: “This was an exciting opportunity to back an early-stage medical device business with a truly innovative technology that has the potential to make a significant positive impact on a strained area of the healthcare system.
“The investment brings BGF’s investments in Wales to five. Other current investments include those into Swanseabased Character.com and Ammanford firm Victorian Sliders.”
Dr Richard Thompson, senior investment executive at the Development Bank of Wales, said: “As an initial investor into IQ Endoscopes, we’re delighted to see the progress they’ve made.”
British Business Bank,
A new £130m fund to back the growth of Welsh firms from the British Business Bank will be operational this autumn, says its chief executive. Louis Taylor, who heads up the UK’s Government economic development bank, also confirmed that a competitive tendering process for those seeking to manage what will be debt and equity pots within the fund will be launched in March. The Welsh fund was first announced by Rishi Sunak, then as chancellor, in the 2021 Autumn Statement. While still to be finalised, the fund is expected to have a similar profile to a new fund for the south west of England from the British Business Bank, with microloans up to £100,000, another for debt funding up to £2m and then an equity investment element.
The equity component in the south-west fund will allow investments per deal up to £5m. Also to be decided is whether the fund will have a regional dimension or be solely Wales-wide. For example, if regional this could see on its equity
pot an element being ring-fenced for north Wales. If the case it is still to be determined whether fund managers would be asked to bid for regional elements, or for one contract setting out investment targets region by region in Wales.
While the precise split between what will be debt and equity in the £130m fund has to be finalised, equity is expected to feature significantly.
On a recent visit to Wales, Mr Taylor said: “We are delighted there is not only a Wales fund, but for the two other devolved nations and some other regions of the UK as well.
“It is important on structure that the whole of Wales benefits.
“We already have an idea on where we want to go, but there are a few more parties we need to consult with, including the Welsh Government, as they should have a say in what is needed as well.”
Abigail’s
A day nursery in Caerphilly has become what is thought to be the first business of its kind in the UK to be taken over by its own employees.
Abigail’s was jointly founded by Abigail Jones and her father, Michael Donovan, in 2013 and currently looks after 65 children while their parents are at work.
The business employs 25 members of staff. Under the new arrangements, all members of staff become co-owners of the business once they have successfully got through their probationary period of a month.
Mr Donovan said the idea of establishing an employee ownership trust (EOT) along the lines of the John Lewis Partnership had cropped up during a discussion with the firm’s accountant.
“We’ve always been very fortunate with the staff we’ve taken on. They do a fantastic job and we have tried
to pay them as much as we can afford.
“We were thinking about how we could do more for them and when we were told the details of EOT decided it was the right thing to do. As co-owners of the business, the staff share the profits and are able to get a tax-free bonus of up to £3,000.”
Steve Griffiths, managing partner of accountants DWA, who provided advice on the benefits of the EOT, said: “The benefits of an EOT to employees are really significant. EOTs encourage their involvement and will positively affect retention and recruitment, as Abigail’s becomes the local employer of choice within the nursery sector.”
Jeffrey Ross
Jeffrey Ross, one of Cardiff’s leading independent sales and lettings agents, has bought ACJ Sales and Lettings in Penarth.
Jeffrey Ross has acquired the 30-year-old family business from its founder, Anthony Jones, in a deal which will see all 12 staff members at ACJ retained.
The companies’ services will merge, where clients of both businesses will benefit from 50 years of combined expertise gained in the south Wales property market.
This is the second buyout Jeffrey Ross has completed in recent years, following its acquisition of Seel and Co, one of Wales’ oldest auction houses, in 2019.
Ross Hooper Nash, managing director of Jeffrey Ross – which has four branches across Cardiff – said of the acquisition: “We have been looking for a long time for the right business to invest in, and ACJ presented the perfect opportunity for us to grow our customer base in the Vale of Glamorgan.”