Lloyds Development Capital (LDC) has invested in a management buy-out of model retailer and wholesaler Modelzone Holdings.

Lloyds Development Capital (LDC) has invested in a management buy-out (MBO) of model retailer and wholesaler Modelzone Holdings.

The MBO values the group, which comprises retailer Modelzone and wholesaler Amerang, at £5.6 million. As part of the deal LDC, which invested £300,000 in Modelzone at the end of last year, has agreed to inject a further £3.6 million over the next three years to facilitate an ‘accelerated retail roll-out plan’ and fund acquisitions.

Modelzone CEO David Mordecai led the MBO, supported by the group’s new non-executive chairman Terry Norris, who was appointed through an introduction by LDC.

Peter Brooks, managing director of LDC, says, ‘Our eleventh transaction this year is not only right in our sweet spot of consumer and retail products, but we have worked closely with [Mordecai] and his team over recent months to shape and deliver it against one of the toughest sector backgrounds imaginable.’

Advisers to LDC included accountancy firm Tenon and lawyer CMS Cameron McKenna, while management were assisted by BDO Stoy Hayward and Shadbolt Law.

With 29 stores in the UK, Modelzone offers a range of models including plastic kits, die cast collectibles, remote control vehicles and railways. Amerang is a wholesale agent in the UK for overseas suppliers in the model and hobby industry.