UK mid-market private equity house Dunedin has backed its eighth business in the support services sector with the GBP23.5m management buyout of Jersey-based trust company Rathbone International, which
UK mid-market private equity house Dunedin has backed its eighth business in the support services sector with the GBP23.5m management buyout of Jersey-based trust company Rathbone International, which is being renamed Hawksford International.
The acquisition price will also include deferred consideration of unsecured subordinated loan notes, with an initial issue value of GBP5m, which will be repaid on the earlier of a future sale or listing of the business.
Hawksford International designs, establishes and administers trusts, foundations, family offices, companies and private trust companies for high and ultra high net worth individuals and corporate clients. Dunedin will take a significant minority stake in the business, alongside key managers in the business who will own the remainder.
The business, which has its foundations in the mid-19th century, has been built through a series of amalgamation of professional firms in Jersey, the second largest global centre for offshore trust administration services. The Hawksford name is taken from a firm of solicitors that is one of the predecessors of the current business.
The firm employs 150 people, a high proportion of whom are lawyers, accountants and members of the Society of Trust and Estate Practitioners, and had turnover of GBP16.5m last year, when it administered 2,800 structures for 2,100 clients.
Following the buyout, Hawksford International plans to expand its range of professional services and international network to meet growth in demand for expertise in trust structures as new wealth flows to established jurisdictions.
‘Industry forecasters believe that the global market for trust and fiduciary services will grow in value by 5 to 10 per cent a year over the next five years,’ says Dunedin director John Hudson, who joins the Hawksford board as a non-executive director.
‘Rathbone International’s legal heritage engenders a level of confidence that differentiates it from other captive trust operators and means it is well placed to meet the increasingly complex demands of international clients.’
Hawksford managing director Nigel Bentley (pictured, right, with Hudson) says: ‘We’ve concentrated on building a reputation for a strong combination of advisory and technical and administrative capability, to give clients a complete and personal service in this key area of wealth management.
‘In approaching this acquisition we wanted to ensure that we have the right level of investment available to support our business strategy, which will continue to depend on high service standards and continuity in our client relationships.
‘Dunedin made clear they want to help us grow by reinforcing the quality and value of all aspects of our service. We will be looking, with Dunedin’s backing, at immediate opportunities to expand the business in Switzerland and the Far East.’
Michael Covell joins Hawksford as chairman from the private wealth management arm of Goldman Sachs. He has considerable experience in the trust sector, including 20 years at chartered accountants Rawlinson & Hunter, which specialises in financial, taxation and trust advice for wealthy international private clients.
Dunedin, an independent private equity house with offices in Edinburgh and London, provides equity finance for management buyouts and management buy-ins with a transaction size of between GBP10m and GBP75m. It also manages the quoted Dunedin Enterprise Investment Trust.
The firm invests in established companies in the construction and building materials, consumer products and services, financial services, healthcare, leisure, specialist manufacturing and support services sectors. Its recent investments include Capula, Fernau Avionics and Gissings Advisory Services, while exits have included Letts Filofax, Caledonian Building Systems, Celtic Inns, Travel & General Insurance, Portman Travel and Zenith Vehicle Contracts.
