Close Brothers PE backs manufacturing MBO

The private equity division of Close Brothers has backed its second manufacturing buyout this month.

Close Brothers Private Equity (CBPE) has committed £11m to the management buyout of Gradus, a UK-based floor coverings manufacturer.

The deal valued Gradus at around £30m and includes the firm’s floor coverings business, a fabrics firm, floor lighting to cinemas and three non-trading companies.

Gradus' main source of revenue is the flooring contracts it maintains in the healthcare and university sectors, which accounted for the bulk of the £34.5m turnover Gradus recorded for 2000.

It is for this reason, and the company’s strong management team, that CBPE invested said Sean Dinnen, a partner at Close Brothers.

CBPE invests in a number of sectors including leisure and tourism, business services, transport and distribution and specialist manufacturing. This last sector has been of particular interest to CBPE of late. At the start of the month, the firm backed the MBO of the UK-based fragrance chemicals business of US group International Flavors & Fragrances for an undisclosed sum.

CBPE is the private equity business of Close Brothers. Established in 1984 , it invested around £250m in 2001. The firm is today raising funds for CBPE Fund VI and by the end of 2001 expects to have funds under management of more than £300m.