Dains Corporate Finance assist Smarts Plumbing Specialists Limited with securing finance for growth

Deal Summary

Smarts Plumbing Specialists Limited (“Smarts”), a leading Midlands-based provider of plumbing and heating services, has raised a £3.5million term loan to support the next phase of growth and to bring a number of key employees into the ownership of the business.  Smarts was advised by Roy Farmer & Harvey Austin of Dains Corporate Finance, with a long-term unsecured loan facilitated by Caple and a working capital facility provided by Close Brothers.

Smarts, based in Heath Hayes, was formed in 1972 by John Smart, and then subsequently acquired by his three sons Alan, Kevin and Chris in 1993.  Smarts installs plumbing and central heating systems into new build residential properties and has developed complementary business streams in the areas of maintenance and boiler servicing.  Smarts has longstanding relationships with all of the major national housebuilders including Barratts, Persimmon, Taylor Wimpey and Redrow and prides itself on providing a quality service and high levels of aftercare, thereby maintaining its excellent reputation in the market.

The difference we made

We spent a considerable amount of time at the planning stage to understand precisely what Alan, Kevin & Chris wanted to achieve.  Their key objectives were the ability to maintain the independence and culture of their family business, to raise some external finance to partially de-risk, but at the same time to continue to work in and retain a significant interest in the business.  This would allow the brothers to plan for their longer-term succession and to develop their team, bringing through some existing team members into the ownership of the business.

We ran a streamlined fund-raising process and identified a number of funders who were willing to support the transaction.  The long-term funding package negotiated with Caple (supported by a working capital facility provided by Close Brothers) was the most flexible and best suited the requirements of the business.

We provided advice and guidance around the company valuation and the structure of the transaction, as well as providing tax advice to the company and all shareholders.

What our client said

Managing Director Alan Smart said: “The company was formed over 45 years ago by my father John, and me and my brothers continued to develop the business following dad’s retirement.  We are a fiercely proud family-run business with a strong culture and over the years have built a loyal and experienced team who we regard as our extended family.  I am very excited about the future, and myself and my brothers will continue to drive the business forwards whilst developing the management team and bringing them into the ownership of the business."

"Whilst in recent years we have invested in the business in terms of our head office, people and systems, the funding we have now raised allows us to further invest in the business.  We will continue to expand the business and to grow our experienced team of heating and service engineers in order to capitalise on the significant opportunities we see ahead."

"The team at Dains provided exceptional advice to the company and guided us throughout the entire process.  Their experience and expertise in raising funds was invaluable and ensured that we reached a successful conclusion."

What we said

Lead advisor Roy Farmer from Dains Corporate Finance added: "As a firm our relationship with Smarts goes back over 30 years, and it has been a delight for me to work with Alan, Kevin & Chris on this fund-raising exercise.  The company’s reputation has been built on delivering a consistently high quality service to all of its customers and with the new funding package now in place this allows the business to further grow and develop its people and services.”

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