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Key Capital Partners supports Construction Materials Online MBO

Private equity house Key Capital Partners (KCP) has acquired a majority stake in Plymouth-based Construction Materials Online (CMO) which operates retail sites supplying DIY builders and small building contractors.

KCP has backed the MBO of the GBP25 million revenue firm, which employs 40 staff and has grown sales through its, and websites by 55 per cent in the last 12 months.
The investment, led by Mike Fell, Philip Duquenoy and James Excell of KCP’s London team, is the second from KCP’s new fund and marks its 16th investment since the private equity firm launched in 2007.
Clydesdale Bank’s corporate and structured finance team in the South-West and Midlands, led by Ian Howey and Ian Mansell, provided senior debt and working capital facilities to support the KCP investment. 
A team at GCA Altium comprising managing director Sam Fuller, director Katherine Hobbs and associate Declan O’Connor advised the company and managing shareholders.
Fell and Duquenoy will join the board of CMO alongside operations director Callum Tasker, technical director Chris Dorey, e-commerce director Adrian Saunders and marketing director Liz Orgill.
As part of the MBO, former Gear4music chairman Dean Murray will join the board of CMO as chairman to lead the business through its next stage of growth. During his tenure at Gear4music between 2012 and 2016, sales grew from GBP10 million to over GBP55 million with the business being valued at over GBP73 million by the time KCP realised its remaining stake.
“CMO has seen a remarkable revenue and profit trajectory and is now a serious challenger in a very large and growing sector. It is already supplying over 45,000 different products to DIY and commercial builders, thanks to a disruptive model that offers swift nationwide doorstep delivery and competitive pricing to trade and retail customers,” says Duquenoy.
“The UK market for these products is growing and with a strong brand proposition, a savvy digital marketing strategy and expanding and diversified product lines, CMO has a unique opportunity to expand very quickly with the resources, expertise and capital we are investing,” he adds.
Murray says: “KCP has a strong track record in growing online businesses in niche areas and CMO needed a partner able to provide the capital, expertise and experience to take a successful e-commerce business to the next stage of its development, just as KCP has done so successfully with previous investments such as Gear4Music.
“We are looking forward to working closely with the team to build the business and diversify into other related sectors that we plan to target.”
London and Leeds-based KCP is an investor in the smaller buy-out market making investments of GBP3 million to GBP15 million in profitable growing companies.

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