European venture capital firm 3i has backed the E100m buyout of Rotterdam-based tank container operator United Transport Tankcontainers (UTT) from United Transport International of the UK. The deal provides a partial exit for UK mid-market private equity house Close Brothers Private Equity.
Bank of Scotland is providing senior debt, representing approximately half of the transaction size. The rest is a combination of asset finance from various institutions and equity from 3i.
United Transport International, which is backed by Close Brothers Private Equity, decided to sell UTT, formed in the late 1980s, in an effort to focus on its core dry bulk business in the UK.
Mark Redman, investment director at 3i Benelux, said that firm first became aware of the deal a year ago, when PricewaterhouseCoopers presented them with the idea. PwC acted as financial adviser to 3i and management on the transactions.
Commenting on the firm’s plans for the business going forward, Redman said: “This is a growing market in excess of GDP, so organic growth is the most important aspect of the business plan. We are also looking to make one or two small acquisitions in due course. Although it is too early to say, an exit is more likely to be through a trade sale than an IPO.”
The management buyout follows a number of recent deals by 3i in the transport and logistics sector, including last year’s £110m buyout of Go-Fly from British Airways, which was later sold to EasyJet for £374m.
UTT manages the whole logistic, door-to-door, movement of liquid chemicals and food intermodal tankcontainers for blue chip chemical and food manufacturers. With ten offices world-wide, the firm is the second largest short and deep sea operator.