Risk Capital Partners makes 2.5 times return on marketing company sale

Risk Capital Partners has made its fourth full exit in the past 15 months with the sale of its 25 percent stake in the creative design and marketing services company Loewy.

Risk Capital Partners has sold its 25 percent stake in Loewy, a creative design and marketing services business, to the company’s shareholders, for £2.5 million ($5 million; €3.7 million).  The sale, which values Loewy’s entire business at £20 million, generated a 2.5 times return on Risk Capital Partners’ original investment and internal rate of return of 41 percent, according to a statement.

Lucky Strike: a Raymond Loewy design

Risk Capital Partners bought Loewy in March 2004 for £1 million, backing the merger of Raymond Loewy International; the company built around industrial designer Raymond Loewy, and Wilson Harvey, a London-based marketing agency, to form Loewy as a buy-and-build vehicle.

Ben Redmond, director at Risk Capital Partners, said: “It was a very small investment and we wanted to do bigger deals.  The business was in a position to organise a share buyback because of its growth.”

Risk Capital Partners’ only other investment in the media sector is in Superbrands, a London-based publishing business.

Risk Capital Partners’ other full exits in the last 15 months are the sale of Signature Restaurants, a London-based restaurant company, for £91 million; Mayfair Gaming, a bingo operator, for £27.5 million, and Integrated Dental Holdings, a UK dental practices operator, for more than £100 million.