LDC leads Ethel Austin MBO

Lloyds TSB Development Capital has co-ordinated a £55m buyout of the clothing retailer.

Lloyds TSB Development Capital (LDC) has led an institutional buyout of
Ethel Austin, the UK discount clothing retailer.

The deal sees the retailer receive additional financing of £11m as it continues with its expansion programme which has seen it more than double the number of
its outlets in the last ten years. The total value of the deal is £55m.

Ethel Austin runs 238 discount clothing stores largely based in the
north of England. The firm has forecast turnover of £135m for the current
year and part of the firm's expansion strategy will see it open stores in
Scotland, London and the North East.

The management team was led by CEO Phil Hoskinson, who has been with the
business for 27 years. The Austin family will retain a small equity stake in
the company following completion of the acquisition.

Barclays Leveraged Finance provided ‘significant’ funding for the
transaction. LDC was advised by Pricewaterhouse Coopers Corporate Finance.

Paul Johnson, investment manager at LDC’s Manchester office, said that the
acquisition gave the firm access to a market leading business in an
expanding market. The discount retail market has doubled in the last five
years, outperforming non-discount clothing retailers.

LDC is the UK venture capital arm of banking group Llyods TSB and has developed an extensive regional network of offices and executives in its pursuit of domestic mid-market transactions. Last year the firm provided £115m to 28 companies and has a portfolio with an estimated value of £1.25bn.