3i invests £21m in MKM Building Supplies

27 Mar 2006

3i today announces it has invested a further £21m into MKM Building Supplies ("MKM"), the fifth largest independent builders' merchant in the UK.  The existing management of David Kilburn and Bill Acton retains an interest in the business and is investing alongside 3i.

The funding, together with new bank facilities provided by Lloyds TSB Acquisition Finance, provides an exit for Malcolm Walker and Peter Murray and will allow MKM to accelerate its roll out plan. The company, headquartered in Hull and operating primarily across the North East of England, has 19 sites between Grimsby and Edinburgh and is aiming to double this number over the next three years. It has a turnover of £82 million.

MKM was founded in 1995 by Malcolm Walker, David Kilburn and Peter Murray.  3i invested £1m of development funding in 1998.  Over the last ten years, the business has achieved an impressive track record of development, making it the fastest growing business in the sector. 

John Rastrick of 3i, commented: "MKM is a quality business. I'm delighted that 3i is able to provide significant further investment to help the company achieve its growth potential."

Malcolm Walker commented: "MKM is a great business and I am delighted that 3i has committed further investment." 
 
Debt was provided by Lloyds TSB Bank. 3i was advised by Addleshaw Goddard and Ernst & Young in Leeds and due diligence was provided by PriceWaterhouseCoopers, Leeds.  The management's legal advisers were Lee & Priestley.

The exiting shareholders were advised by Deloitte and Dickinson Dees in Newcastle.

Notes to editors

About 3i

3i is a world leader in private equity and venture capital.  We focus on Buyouts, Growth Capital and Venture Capital and invest across Europe, in the United States and in Asia Pacific.  Our competitive advantage comes from our international network and the strength and breadth of our relationships in business.  These underpin the value that we deliver to our portfolio and to our shareholders.

3i's Growth Capital business focuses on investing minority stakes in high growth companies expanding organically or through acquisition.  The business currently manages 300 investments across Europe and Asia with a value in excess of €1.8bn and invests across a broad range of industry sectors, including healthcare, business services, consumer, media, technology and oil, gas and power. 

Recent investments include Nimbus, India, €36m; Boxer, Sweden, €84m; Clinica Baviera, Spain, €40m; Williams Lea, UK, €68m; Renta Corporation, Spain, €20m; Novem CID, Germany, €25m; Vetoquinol, France, €20m and PEARL, Singapore, €8m.  Recent exits include Cannon Avent, UK, €450m; Pets at Home, UK, €330m; Wood Group, UK, €37m; Ascent Technology, UK, €34m; Raynal, France, €0.5m and Highland Energy, Germany, €178m.