Changing faces - Hillarys Group management are ready to take the next step after finalising a secondary buy-out.

Made-to-measure window blinds specialist Hillarys Group has completed a secondary buy-out after raising £115 million.

The management turned to private equity firm Change Capital Partners (CCP) to finance this latest deal - three years on from the first buy-out, which was carried out after the company secured funding from Close Brothers Private Equity.

Since the first managerial change, the group's turnover has increased to £85 million from £55 million, but the management believes a secondary buy-out was crucial to achieving further growth.

Steve Petrow and Lorenzo Russo from CCP have joined Hillarys' board as investor directors.  They will work with group CEO and managing director James Nicholson, group sales director Mick Shanks, group marketing director Fiona Ferguson and group manufacturing director David Burke.

Accountancy firm PricewaterhouseCoopers (PwC) was asked to advise Hillarys Group shareholders in August 2002 before preparing the company for sale.  Partner Sean Williams and director Jane Hughes, who specialises in retail and branded goods, led the team.  PwC completed the deal eight weeks after being introduced to CCP.

The firm's previous dealings with Close Brothers helped push the transaction through, according to Hughes.  "PwC has long standing relationships with Close Brothers having successfully worked with them on previous assignments," she said.  "This meant that we were well positioned to advise them on planning and executing their exit from the business."

PwC's Transaction Services team also contributed to the deal by carrying out sell-side due diligence for Hillarys Group shareholders.  Partner Nigel Ward and senior manager Chris Heatlie were asked to participate after working with the previous buyout team in 2001.

Ward now hopes that PwC's relationship with Hillarys will continue to flourish.  "It is clear that things do not stand still for very long at Hillarys," he said.  "Hopefully in another few years we will be in a similar position commenting on how this is the third time that we have reviewed the business, and that management has continued to deliver on its plans."

Catalyst Corporate Finance, BVCA's corporate finance boutique of the year, introduced CCP to Hillarys and assisted both parties by negotiating and managing the deal through to completion.  The Catalyst team comprised Keith Pickering, Richard Sanders and Justin Crowther.

Catalyst's Keith Pickering belives Hillarys will enjoy continued success after completing the deal.  "Hillarys is a fantastic success story and James, his management team and the whole employee base deserve every credit for this position," he said "I am delighted Catalyst has been instrumental in delivering the strategic partner and funding the management team required to allow this success to continue."

Meanwhile, management turned to Yorkshire law firm Gordons for legal advise after the firm helped complete the orginal buy-out in May 2001.  Andrew Jordan, corporate finance partner, advised management and was assisted by James Ryan.

Commenting on the transaction, Jordan said: "A deal like this may start out as a vendor controlled process, but inevitably evolves into a transaction where management are at the hub of all important issues," he said, "So to advise management successfully you have to have sound commercial judgement, exercise it quickly, and get on with other people."

Global private equity powerhouse Kirkland & Ellis International LLP (K&E) represented CCP in the deal.  Partner David Patrick Eich led the team comprising tax partner Ian Taplin, finance partner John Markland, and corporate partners Dr. Nigel Dunmore and Pamela Henry.  Eich has represented Petrow in many leveraged buy-outs over the past decade, but this was K&E's inaugural representation of CCP.  Eich believes the deal was uniquely suited to CCP.  "Guys like Petrow and Russo have been around the block a few times," he said.  "They're very commercial and easy to deal with.  Here, in a very tight process, the execution skills of CCP and its advisers were critical.  From exclusivity to completion took essentially three weeks - we burned our share of midnight oil."