The deal sees the acquiring London-based Charterhouse Capital Partners take a 65 per cent stake in environmental, health and safety, risk and social consultancy business ERM, with the remainder being held by ERM partners.
In 2001 ERM was the subject of a management buy-out led by executive chairman Robin Bidwell and CEO Peter Regan. Private equity firm 3i backed the deal and purchased a 52 per cent stake in the process.
London-headquartered Bridgepoint purchased ERM in December 2005, and Chris Busby, partner at Bridgepoint, says: ‘ERM is a first class business that has capitalised on the market driven opportunity arising from increased regulation, compliance and demand for natural resources and sustainability.’
With Bridgepoint seeing a return on its investment the deal points towards a strengthening in the secondary market. The exit follows the buy-out of Wagamama by private equity firm Duke Street in March. The undisclosed fee was reported to be double the £103 million fee initially paid by the exiting Lion Capital.
Group chief executive of ERM, John Alexander, comments: ‘We are pleased that Charterhouse shares our vision for the future growth of this company as we enter a new stage of our development.’
ERM reported revenues up 12 per cent on the year to $483 million.
UK-based ERM employs 3600 staff across 130 offices in 40 countries. Customers include retail giant Tesco.
The deal comes a month after Bridgepoint hired Goldman Sachs to run an auction for the business.
Stuart Simpson, founding and senior partner at Charterhouse, says that the private equity firm has tracked the progress of ERM for a number of years.
Simpson adds: ‘The company has grown to a size and leading market position that makes this the ideal time for Charterhouse to make an investment in the significant growth potential of this […] business.’