The chief executive and management team at portable accommodation builder Nomad Consolidated have teamed with the ANZ Bank’s private equity arm to complete a management buyout.
The chief executive and management team at portable accommodation builder Nomad Consolidated have teamed with the ANZ Bank’s private equity arm to complete a management buyout.
The buyout comes after a period of rapid expansion, with Nomad’s revenue increasing from $25 million to $60 million during the past three years.
Chief executive Phil Guy said he was targeting revenue to reach $100 million, with a matching increase in earnings.
The buyout transaction has allowed Nomad’s founder Gary McNally to pass control of the business to the company’s managers and key staff, led by Mr Guy.
Mr McNally established Nomad 16 years ago and during the past three to four years it has become one of the largest suppliers of portable accommodation to the resources sector in Western Australia, and one of the top three nationally.
Its major competitors include publicly listed Fleetwood Corporation and the privately owned Ausco.
Mr McNally will remain as a non-executive director and minority shareholder in the business.
ANZ Capital has emerged as the largest shareholder, while 14 members of the management team have also acquired a direct stake in the business.
The funding of the transaction was a mix of debt and equity, with ANZ supplying the debt funding and investing equity alongside the managers.
ANZ Capital director Marshall Allen said “the fact that the CEO and other members of the management team put their hands up to invest in the buy-out was a testimony to the quality of the business that had grown significantly over the past 3-4 years”.
Mr Allen said Nomad had been an ANZ customer since its inception in 1990 in the proverbial “backyard” in East Victoria Park.
The company has progressively expanded, first to Malaga and more recently to purpose-built premises in the Australian Marine Complex at Henderson, where it occupies two factories.
It also has two further facilities in Bibra Lake and recently opened a factory in Brisbane to support its planned expansion.
Nomad’s growth has seen it become a substantial employer, with 30 staff and a sub-contracting workforce of 150 people.
Mr Guy said the company’s growth reflected both the buoyant resources sector and Nomad’s ability to increase its market share.
The company’s services include the design, manufacture and installation of transportable buildings to several industry sectors, with a focus on resources.
Its clients include major mining companies and engineering and construction contractors in Australia, and it has also won contracts in Tanzania, Papua New Guinea and Asia.
The Nomad transaction followed ANZ’s recent investment in Osborne Park food manufacturer Kailis and France Foods.
ANZ invested $15 million to take a 20 per cent stake in K&F, as part of the Perth company’s acquisition of Melbourne firm Australian Convenience Foods.
K&F, founded in 1974, was itself the subject of a management buyout in 2004, when CHAMP Ventures and Foundation Capital joined with managers to buy the business.
The merged business, which trades under the Kailis & France name, is now being run by ACF chief executive Simon Holloway.
He replaced K&F managing director and shareholder Geoff Leding-Wilton, who has left the company.
Mr Allen said the combination of K&F and ACF provided for significant economies of scale to be realised and was a sign of ANZ Capital’s confidence in the sector.
The Nomad and K&F transactions meant two of ANZ Capital’s largest investments were in WA.
