Pebbles Care, one of the UK’s leading providers of care services which support some of the most vulnerable young people across the United Kingdom, is poised for significant growth after changing hands in a deal backed by Private Equity.
Pebbles was founded in 2003 when Luiz Guilherme opened its first home in Leeds which supported 4 young people. Today the company operates 41 residential care homes and 4 schools, providing care across the North of England and Scotland, being manged from its’ head office, located in Edinburgh.
Over the 16 years since its formation, the management team and staff skill base has grown significantly, now making Pebbles the partner of choice for the Local Authorities with which it works.
The company provides a best in class service to support young people aged 8 to 18, suffering from mental health considerations as well as issues of risk and safety, including Child Sexual Exploitation, Attachment, Attention Deficit Hyperactivity Disorder, Autism Spectrum Disorder, Self-Harm, Suicide and Trauma.
However, in spite of the expansion, through the provision of a top-quality service, significantly more referrals are received from local authorities than are able to be offered placements. With this in mind, the change of ownership brings not only investment capital into Pebbles but also brings together a new senior management team with the capability to expand the Pebbles business and capitalise on the growing demand for its services.
The transaction sees Global Private Equity Corporation, Ardenton Capital acquire the business, together with a combination of a new and existing management team, which has invested alongside Ardenton, with the aim of delivering a growth business plan which will involve the provision of services from at least 21 additional homes and 3 more schools over the next five years.
The plan also includes the provision of new services to provide residential care and support for mother and babies and also young children in the 4 to 8 year age group.
Yorkshire based dealmakers, Castle Square Corporate Finance, advised Ardenton Capital and the management team on the acquisition
A Clydesdale Bank team led by Philip Hartley and Jamie Stuart, provide the senior debt for the acquisition alongside a cap-ex facility to fund the acquisition of new properties, together with working capital facilities.
Experienced healthcare executive Mike Walsh joins Pebbles as CEO and invests alongside Director of Operations Alison Moore, who becomes Managing Director, Head of Education, Richard Graveling and Head of Commissioning, James Doyle. Mike Walsh said,
“This is a tremendous opportunity to work alongside a great team who continue to prove their dedication in providing outstanding care services for young people. With this deal, the business now has the backing to grow and cement its position as the leading care provider in the UK for young people.”
The acquisition by Ardenton was led by Investment Director Ian Marlow, who was supported by James Worrall and Grant Goodwin from the Manchester office.
Ardenton Capital is a long-term investor, whose objective is to create meaningful business partnerships and long-term growth, working strategically to nurture management teams and expand into new markets, growing small companies into lasting multi-national organizations. Iain Marlow, Director at Ardenton said,
“It’s a privilege to be working alongside the Pebbles Care management team to support the invaluable work the business does look after some of the most vulnerable young people in society. Our investment will enable the team to invest further in the quality of their care providers and expand their services to provide more capacity. At Ardenton, we look to work with proven and ambitious management teams to help take their business to the next stage of growth.”
Advice on the transaction was provided by a team from corporate Finance specialists, Castle Square, led by Director Kevan Shaw, with support from Steve Bell and Patrick Lynch. Kevan Shaw said,
“Pebbles is a first-class business that has grown through provision of a quality care service, supporting young people who need significant support. We are delighted to have advised on a transaction which will see significant expansion of these services, in respect of which the outcomes are so important to those young people in need. I am certain that the senior management team, together with backing from Ardenton and Clydesdale, will take the business to the next level”. Other advisers on the acquisition were:
Andrew Green from Addleshaw Goddard provided legal support to Ardenton. Clare Connell of Connell Consulting provided commercial due diligence advice. Simon Wormald and Ian Roberts from KPMG provided financial due diligence support. Catherine Kay and Nathan Main from PWC provided tax advice to Ardenton. Marsh Group provided insurance due diligence. Browne Jacobson provided legal services to Clydesdale. Sanderson Weatherall was the property consultants. Freeths provided legal services to the management team.