Direct marketing business Granby Marketing Services has secured the backing of Enterprise Ventures to part-fund a management buy-out (MBO).

The Blackburn-based business, which provides service including e-commerce fulfilment and warehousing to customers including Sainsbury’s and the Wales Cricket Board, was initially acquired by Stephen Bentley from Omnicom in 2000. Since then it has gone on to grow revenues from £1.5 million to over £5 million.

Following the deal, managing director Joanne Varey will become a majority shareholder, with Bentley moving from CEO to chairman and a minority shareholder.

Backing for the deal has come in the form of £1.35 million from the Enterprise Ventures EV Growth fund and investment from directors. On top of that, Natwest is providing £600,000 term debt alongside a £500,000 working capital facility from RBS Invoice Finance.

Varey comments, ‘This feels like a natural step for the business to ensure we are evolving and maintaining our position as a market leader.

‘It’s a fantastic opportunity for us to continue building on the growth and success Granby has undergone in recent years.’

More on recent management buy-outs:

• Pizza Express backer supports Nielson MBO
• Virgin Wines closes £15.9 million buy-out
• Skyscanner investor backs Tryzens deal

Speaking to GrowthBusiness back in November 2012, Bentley said that the key to getting Granby back to profitability hinged on ensuring that solid revenues were flowing through the front door and also focusing on maintaining a solid cash flow to support the growth of the business.

As directors, Bentley and his colleagues had made commitments to the business to ensure that there was going to be enough cash in case of emergency.

Wayne Thomas, investment director at Enterprise Ventures, says, ‘Granby is a profitable, well-positioned service business with an impressive, long-standing client base.

‘It has invested heavily in IT over recent years to keep pace with new technologies. With large companies increasingly outsourcing non-core activities such as direct mail and fulfilment, the market is growing and Granby is well placed to take advantage of the opportunities.’