CBPE, the leading mid-market private equity business of Close Brothers Group, announces that it has today arranged equity funding of £37m to facilitate the acquisition by its investee company Yardbrace Group of Rentokil Initial plc’s Intermodal Bulk Containers Division. This will create a £120m merger of the container/tank division of Yardbrace with Initial IFF (“IFF”) and
Initial Tankcontainers (“ITC”).

IFF and ITC are providers of bulk chemicals logistics services to the petrochemical industry and major providers of logistics services to international groups such as BP Amoco, BASF, Dow and Bayer. IFF focuses on dry bulk chemicals movements in Europe and ITC transports bulk liquids on a global basis. In 1999 the two businesses had turnover totalling £100 million.

IFF and ITC are being merged with Yardbrace Group, an existing and highly successful CBPE investment. In aggregate, the merged group will have annual turnover of approximately £200m.

The transaction will be financed partly by way of new funds from CBPE and via an acquisition finance and working capital facility of £78m provided by Bank of Scotland.

John Snook, Managing Director of CBPE and a non-executive director of the new holding company, United Transport International Limited, commented on the transaction.

“This is a perfect investment opportunity for us. We are backing a management team we have known a long time in a further major acquisition. The combined businesses will have a really strong market position. It is typical of the mid-cap transaction size we specialise in.

The merger of Yardbrace with IFF and ITC creates a formidable force in bulk chemicals logistics. The new group will be very well positioned to deliver the sophisticated logistics services the customer base is increasingly demanding. It is a tremendous step forward for both businesses”.

Keith Wise, Managing Director of United Transport International said,

“This is a genuine merger which creates very significant opportunities for the enlarged group.

The management teams of both businesses are very familiar with each other’s operations, which should make for a smooth transition and rapid realisation of the exciting plans we have for the business. We look forward to continued growth in both dry bulk and liquids sectors in the future.

I’m looking forward to the management challenge of integrating two strong businesses and creating a world leader”.