PSL receives last-minute reprieve in Apax and BHF
Supply Venture capitalists join management to buy the Skillsgroup distribution division.
The management buyout of Skillsgroup's distribution arm PSL wasup distribution division. brought back from the brink in a last-minute deal with venture capitalists for #16 million.
As exclusively revealed in PC Dealer (13 May), the distributor has been attempting to perform a management buyout for at least the past three months.
The rescue mission by Apax Partners and BHF, the German corporate bank, put the MBO of PSL back on track, following last month's hiccup when its management team failed to raise the necessary funds, forcing parent Skillsgroup to announce PSL's impending sale on the open market.
The division will be sold to the management team and venture capitalists for #15.5 million in cash - to be paid on completion - as well as a deferred #500,000 payable in the event that PSL is successfully resold or floated by the management team.
Commenting on the buyout, Mike Kontowtt, managing director of PSL, admitted: 'It is never a straightforward process. It took us an extra couple of weeks longer than we had hoped.'
He also revealed that he had originally spoken to Apax partners as early as December 1997. But Apax declared that any forthcoming deal with the venture capitalist would be subject to PSL implementing an updated IT system.
Kontowtt insisted the priority was to grow the PSL business.
'We needed the money to grow the business, not just to buy it. There are no specific plans to sell or float other than those you consider when you undertake an MBO,' he said.
'We will grow the business for three to five years and if the right person comes along or if the time is right for floating, then we will consider it. But it is not the cornerstone of our philosophy to float,' Kontowtt added.
He also indicated that Apax wanted to eradicate PSL's dependency on Hewlett Packard, as it is one of two high-end specialist distributors in the UK and would look to sign up additional vendors.