Zeus Capital is acting as Nominated Adviser and Sole Broker to Accrol Group Holdings (ACRL.L) on its AIM IPO and GBP63.5 million fundraising and advised on a new GBP38 million flexible debt facility provided by HSBC.
Accrol will have a market capitalisation on admission of GBP93.0 million (based on the placing price) with Zeus Capital raising GBP63.5 million with GBP20.2 million for selling shareholders and GBP43.3 million to reduce debt, including shareholder loan notes.
The IPO provides a partial exit for the Hussain family and NorthEdge Capital who each retain 15% of the equity in the listed company going forward. The directors intend to pay an annual dividend equating to a yield of 6 per cent. calculated on the placing price.
Accrol is a leading independent tissue converter, importing industrial sized paper reels (parent reels) from around the world and converting them into toilet, kitchen, facial and other tissue products at the Company's 350,000 sq ft manufacturing, storage and distribution facility in Blackburn, Lancashire. Accrol currently manufactures approximately 16 million units per week and supplies some of the UK's largest retailers.
Accrol started converting operations in 1993 and has grown to become the leading supplier of tissue products to the UK discount market, supplying both that market and some of the UK's largest retailers.
Accrol has a 35 per cent. market share of the discount market and 7 per cent. of the overall UK tissue market. The Company's exposure to retailers operating in the discount market sector has driven continuous financial growth over the last seven years and the directors believe the business is well positioned to continue to benefit from growth in the discount market and the market for private label products.
Peter Cheung, Executive Chairman at Accrol Group Holdings, says: “We are delighted by the level of interest and support we have received from high quality institutional investors and I would like to thank the team at Zeus Capital for delivering a seamless transaction. We are a very well invested company with an attractive and progressive dividend policy and we look forward to creating value for all of our shareholders in this new and exciting stage in Accrol's development.”
Dan Bate, Director at Zeus Capital, says: “It is a pleasure to advise Accrol Group Holdings plc on its admission to AIM, GBP63.5 million fundraising and new GBP38 million debt facilities. The Hussain family has built up a successful business since it was founded in 1993 and will be stepping back as part of a managed hand over process to the executive team. I am confident that with the support of its new institutional investors, Accrol will go from strength to strength as a public company. I am delighted also to have supported NorthEdge on the successful completion of the first exit from its maiden fund.”
Dan Wright, Head of Portfolio at NorthEdge Capital, says: “We are delighted to have partially exited our first investment from Fund I by way of IPO. We believe Accrol will go from strength to strength on AIM as a public company, thanks to the strong shareholder base, management team and underlying operations of the business. We look forward to a new chapter in Accrol’s development.”
