Brown Rudnick advises Victoria Plc in PIPE deal and simultaneous acquisition
PUBLISHED ON: 12/12/2014
(LONDON) 1 October, 2014 – Brown Rudnick LLP, the international law firm, has advised AIM-listed Victoria Plc, the 120 year old carpet manufacturer, on its new £10 million investment from Business Growth Fund (BGF), the investment fund backed by the UK’s five largest banks and on its acquisition of rival Abingdon Flooring Limited.
The BGF investment in Victoria takes the form of loan notes with a fixed coupon, with no capital repayment for the first five years and the capital then being repaid over the following three years, plus an option over shares in Victoria. Unlike many private investment in public equity (PIPE) deals, it does not use a convertible loan instrument, is unsecured and affords greater flexibility. Lena Hodge, Partner in Brown Rudnick’s Corporate Practice, advised Victoria.
The BGF investment enabled Victoria, whose carpets are found in Buckingham Palace, Balmoral Castle and several other Royal residences, to acquire Abingdon Flooring Ltd, one of the UK’s largest privately-owned manufacturers of quality carpets for £7.655 million plus deferred cash consideration of up to £4.5 million dependent on EBIT performance targets.
Lena Hodge, Head of Equity Capital Markets, Brown Rudnick, said: “The structure of this transaction affords greater flexibility than you would normally see in PIPE transactions and hopefully raises awareness of the opportunity for private equity and others to invest in growth companies on AIM.”
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About Brown Rudnick LLP
Brown Rudnick, an international law firm with offices in the United States and Europe, represents clients from around the world in high-stakes litigation, international arbitration and complex business transactions. Clients include public and private corporations, multinational Fortune 100 businesses and start-up enterprises. The Firm also represents investors, as well as official and ad hoc creditors’ committees, in today’s largest corporate restructurings, both domestically and abroad. Founded more than 60 years ago, Brown Rudnick has over 230 lawyers providing advice and services across key areas of the law. Beyond the United States, the Firm regularly serves clients in Europe, the Middle East, North Africa, the Caribbean and Latin America. With its Brown Rudnick Center for the Public Interest, the Firm has created an innovative model combining its pro bono, charitable giving and community volunteer efforts.
Business Growth Fund
BGF is an active UK growth capital investor in small and mid- sized companies. It was established in 2011 as an independent company, with up to £2.5bn to invest and a mandate to support the growth of British smaller and mid-sized businesses (usually generating a turnover of between £5m-£100m).
This transaction marks the first time that BGF has invested in a publicly listed company. BGF's investment is unsecured and flexible, in line with its approach as a provider of capital to support companies' development over the longer term. Investing in listed companies is a natural next step for BGF in its drive to provide long-term equity investment to those growing companies that do not have enough access to this source of capital.
BGF makes long-term equity investments of between £2m and £10m in businesses with the potential to grow and in turn receives a minority stake and a seat on the board.
BGF is backed by five of the UK's main banking groups - Barclays, HSBC, Lloyds, RBS and Standard Chartered but is a fully independent organisation. For more information, visit www.bgf.co.uk
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