A leading private equity firm investing in Europe

Pan-Asian restaurant chain

A leading private equity firm investing in Europe

Manufactures and distributes medical devices

A leading private equity firm investing in Europe

Plant hire business

A leading private equity firm investing in Europe

Pioneering UK value retailer

A leading private equity firm investing in Europe

Specialist provider of healthcare services

We invest in Western European mid-market companies

Duke Street Private Equity has been investing in mature, mid-market West European businesses for over twenty years, concentrating our investment strategy on four sectors: Consumer, Healthcare, Industrials & Engineering and Services. Typically we invest in companies with an enterprise value of between £50m - £250m. Our strategy is based on our ability to identify unique opportunities and add value to each business we acquire. We aim to transform the prospects of the companies that we invest in.

Origination beyond the obvious

We focus our efforts on transactions developed on an exclusive basis. We actively seek complex deals which other investors may avoid if we think they have underlying growth potential.

Value creation

Our mission is to accelerate the growth of the companies that we buy. We help our companies grow both organically and through acquisition.

Supportive Structure

We have developed a robust approach to building relationships between ourselves, the CEOs of our portfolio businesses and our Operating Partners.

Sector focus

We believe sector knowledge is critical, which is why we have dedicated teams focusing on our four core sectors. This, alongside the deep industry experience of our Operating Partners, has allowed us to create a proven track record of successfully building companies.

We invest in companies with strong brands serving consumers across multiple channels

We have extensive experience in the consumer sector: in restaurants with wagamama, in the gaming sector through our investment in companies such as Gala Bingo, Sporting Index and Leisure Link. In leisure, we have invested successfully in both niche hotel operators and fitness and leisure businesses. Two of our investments in particular – SandpiperCI and The Original Factory Shop – display our willingness to back retail management teams with ambitious growth plans, even at a time when the sector as a whole was experiencing tough trading.

We also have a wealth of experience of working with management teams in consumer branded products. At Simple, we backed an ambitious growth plan for the business to become the UK’s leading skin care provider by volume, overtaking companies such as Nivea and L’Oreal in the process.

See our Portfolio for a more in-depth analysis of these and further Consumer investments.

Duke Street is a long-term investor in the healthcare space, making our first investment in 1997

Since then we have deployed c. €700m in the sector, backing great management teams to deliver transformational business plans.

We believe the sector to be structurally attractive: it is defensive and benefits from significant barriers to entry due to the complexity of the products and services involved.

We also believe that it lends itself well to our investment strategy. Europe is home to a large number of strong management teams, and high value-added businesses which deliver outstanding patient outcomes. Such businesses typically offer multiple routes to value creation. Even the most mature sub-sectors remain fragmented and so there is significant potential for buy and build.

Please see our Portfolio for a more in-depth analysis of our past and present Healthcare investments.

We cover a broad range of Industrials sub-sectors with a particular focus on aerospace & defence, engineering, manufacturing & security

We look to invest in companies with differentiated product or process IP, operating in attractive end-markets, with scope to affect operational transformation through inter alia, a build-up in specific niches, technological changes, or product / geographic diversification.

We back management teams with a clear strategic vision as well as a strong operational focus; and our in-depth understanding of the sector means we are well-placed to work in partnership with such teams.

Our investments in this sector include Deloro Stellite, the specialist engineering group, and filtration solutions provider Madison Filter. See our Portfolio for a more in-depth analysis of these and further investments.

We invest in services businesses with the potential for operational improvement and rapid growth

The services sector encompasses a wide range of sub-sectors, each subject to its own dynamics but often with outsourcing as a key driver. We identify macro trends that will drive above average market growth, and then back businesses providing value added skills and products to their customers in those markets. We are particularly attracted where there is the potential for operational improvement as well as organic growth. We partner with best-in-class management teams providing support, capital and expertise where this is required and materially adds value.

We have considerable experience in the sector, complemented by a large network of industry contacts. Investments we have made in this sector include Ardent Hire Solutions, a heavy equipment hire business, Payzone, a consumer payments business, and the specialist pensions group Xafinity. See our Portfolio for a more in-depth analysis of these and further Services investments.

Our Portfolio

Paragon

SECTOR: Healthcare

Leading provider of speciality residential care for patients with learning disabilities

Backing high-quality management teams means being prepared to follow strategies that might diminish earnings in the first place in order to realise much better earnings later on. Paragon – one of Duke Street’s most successful UK investments – involved just that. We brought in a very experienced team and backed their plans to transform the business by serving a wider range of higher-value markets and through a series of important acquisitions.

Investing in rapid turnaround

When we acquired Paragon, formerly Milbury, in 2001, its private owners were struggling to meet the demand for its services. The company provided community-based care for people with learning disabilities and other complex needs. While it operated in a sector that was benefiting from government healthcare reforms and had excellent long-term growth prospects, the company was held back by a lack of access to capital.

Until we invested in Paragon it had grown exclusively through organic means. With our backing, management was able to turn around the business and reposition Paragon as the highest-quality provider in the learning disability sector.

Ambitious growth strategy

Our first move was to appoint a new management team, with many years of experience in the healthcare and Private Equity sectors. The team included John Robinson, Chairman; Nigel Harris, Chief Executive; Douglas Quinn, Managing Director; and Nigel Moreton, Finance Director.

To position itself as the highest-quality provider in its sector, Paragon closed 320 beds that didn’t meet its standards. We then arranged a sizeable capital expenditure facility with the Royal Bank of Scotland, to help the company embark on an ambitious organic and acquisition growth strategy.

August 2002 saw Paragon offering a wider range of services with the acquisition of Thelma Turner Homes, a provider of specialist, long-term care, treating people with severe eating disorders and complex behavioural problems. This was followed by three more acquisitions, Headwind, Home First, and Foremost and Carewest, in late 2002 and March 2004. These four companies became the Voyage specialist division of Paragon.

In May 2004, we secured £162 million of funding from Dresdner Kleinwort Wasserstein to refinance the business and fund an accelerated growth programme over the next three years.

Market leader and fastest growing provider

At exit Paragon was the market leader, with over 1,600 beds throughout the UK, and had become the fastest-growing provider in the sector, opening over 650 new beds since our acquisition. Its community-based care set the standard for people with learning and other disabilities and its growth was supported by government legislation. Turnover had doubled to around £100 million in the year to 31 March 2006, and margins had improved significantly.

Exit

In April 2006, Paragon was sold to HgCapital and members of the management team.

Our Team

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Investors

Duke Street has invested £2.4bn and realized £3.7bn since 1994, and currently manages over £500m AUM. Our model ensures maximum alignment between investors and management teams and provides flexibility as well as certainty of funding. Fundraising is aligned with our own internal investment committee process, ensuring timely execution.



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Contact

Duke Street

Nations House,
103 Wigmore Street,
London W1U 1QS

Tel: +44 (0)20 7663 8500
Fax: +44 (0)20 7663 8501

Email us

mail@dukestreet.com

You can use the email address above, or write to us for additional security. Enquiries will of course be treated in strictest confidence from time of receipt but we cannot guarantee the security of email (or other) communications with us.