Private equity firm Octopus Investments has backed a GBP15m buy-out of media agency Bruce Dunlop & Associates, taking a minority stake for a GBP5m investment financed from its equity a
Private equity firm Octopus Investments has backed a GBP15m buy-out of media agency Bruce Dunlop & Associates, taking a minority stake for a GBP5m investment financed from its equity and mezzanine funds. The deal was introduced to Octopus by Baker Tilly.
BDA provides promotion and design services to broadcasters and advertisers worldwide, and also creates brand films and internal communications for UK corporations. Since the launch of the business by its three founders nine years ago, the company has reached annual revenues of nearly GBP9m and has 100 employees at offices in London, Munich, Dubai, Singapore and Sydney. The firm’s blue-chip customers include Hallmark, Barclays, Discovery and Sony.
As part of the deal Octopus has committed a further GBP2m funding line to support the planned international expansion and to make strategic acquisitions. The business will continue to be run by the current management team led by group creative director Bruce Dunlop and group managing director Honor Barratt, who founded BDA in 1999 with Joan Dunlop. A non-executive chairman is currently being sought.
The deal was lead by Octopus’s Andrew Cavaghan with support from the firm’s investment manager Purvi Sapre. Cavaghan, who joins the BDA board, says: ‘We are delighted to invest in a market-leading media business, led by a highly ambitious and entrepreneurial team. Diligence confirmed the extent of the growth opportunities available in the UK and abroad, and we are keen to support the team in taking full advantage of these in the coming years.’
Adds Barratt: ‘There was considerable interest from both trade and financial investors in BDA, but Octopus seemed to understand what makes BDA so special. It has the appetite to keep up with our global expansion plans and is fully supportive of our ambitions to become the best broadcast design and promotions agency in the world.’
Established in 2004, Octopus Investments is one of the UK’s largest managers of venture capital trusts, with more than 11,000 investors and almost GBP400m under management. Its funds invest in quoted and unquoted companies with a market cap of up to GBP100m. Unquoted investments range from early stage and start-up investments to growth capital and buy-outs in amounts up to GBP8m. Funds managed by the private equity and intermediate capital teams were co-invested in the BDA transaction.
Octopus Private Equity was founded in 2004 and manages four VCT with a combined net asset value of more than GBP110m. The team invests between GBP2m and GBP8m in buy-outs and provide expansion capital for established companies with an enterprise value of up to GBP20m.
Launched last year, Octopus Intermediate Capital is a GBP45m venture capital fund established by Octopus Investments, and invests up to GBP4m in profitable VCT qualifying companies in the form of intermediate capital, mezzanine finance seeking a risk/return profile above that of senior debt and below that of equity.