Case Studies
MBO puts Merseyside manufacturer on the fast track
A Moreton based manufacturer which produces specialist hose has been bought by its management for an undisclosed sum.
Dantec manufactures innovative composite hose, which is used in the international chemical, gas and petroleum industries for transfer of hazardous materials.
The company also produces the Formula One refuelling hoses used by all the teams for the past eight seasons.
Former owner Dan Davis has sold the business to a management team including his brother Eric, sales director Chris Franks and operations director Ged Hall.
The deal was funded by the North West office of Lloyds TSB Commercial Finance who provided asset based lending facilities against the firm's property and receivables. Dantec were advised by Mitchell Charlesworth Corporate Finance and law firm Brabners Chaffe Street.
Dantec started out in 1969 as a gasket cutting business supplying the petrochemical industry in Ellesmere Port. By 1977 growing demand for reliable hoses led to the firm setting up a manufacturing facility in Moreton Wirral.
Now the £4 million turnover business employs 50 people and supplies fuel giants like BP, Shell and Exxon Mobil as well as tanker operators such as Excel Logistics, Wincanton and Sutton and Son.
In 2003 half of the hose produced was exported to customers in 50 countries. The company also boasts a 55 per cent share of the UK market.
Following the buyout the business is focusing on building upon its global distributor network and establishing a presence in countries with potential for growth in sales of composite hose.
In addition to its core activities, Dantec in partnership with London based consultant engineering company BPP Technical Services and the Anglo Australian oil and gas major BHP Billington Petroleum, have developed a new and exciting large bore flexible hose product.
The hose is rapidly becoming acknowledged throughout the offshore community as providing the most promising solution in making the transfer of Liquefied Natural Gas in deep sea applications both technically and commercially viable.
Eric Davis, managing director of Dantec, said: "We have come a long way over the past 35 years and this buyout is the next stage in the development of the business.
"We have a solid domestic and international customer base who understand how important our products are to the safety of their operations.
"As our products are hand built, we expect that our future expansion will create a number of new jobs on Merseyside."
"The asset based lending facilities put in place by Lloyds TSB Commercial Finance will allow us to continue investing in product development and the machinery necessary to meet growing global demand for specialist hoses."
Mike Scowen, regional director of Lloyds TSB Commercial Finance, said: "The buy-out gives the firm a fresh injection of energy and we are confident the determined and talented management team will continue to build upon the business' success.
"The deal is a prime example of how asset based lending facilities are becoming frequently used to fund management buy-outs. The increased cash flow will provide Dantec with a good degree of flexibility in these first few crucial months."
Lloyds TSB Commercial Finance is part of the Lloyds TSB Group plc.
Lloyds TSB Commercial Finance is part of the Lloyds TSB Group plc.
