Capitalising on the cleaning zeitgeist embodied by Instagram phenomena like Mrs Hinch and driven by a spotless focus on channel development and specific liquid detergents, Star Brands is projecting an impressive 60% growth in turnover over the two years to August 2019.
As consumers realise they are paying a significant premium for branded cleaning and detergent products that don’t perform any better than own label equivalents, there is an increasing shift to these own brands. Overall, the own brand market for household cleaning and laundry products is growing by 11% pa and, as discount channels, such as Aldi and Lidl, together with bargain stores, such as Home Bargains and B&M Bargains, gain market share, they are further driving own brand penetration. Star has also identified a substantial opportunity in specialist brands with product differentiation; social media favourites Stardrops and The Pink Stuff are leading the way.
The majority of the BIMBO team has already worked together, trebling turnover at PE-backed convenience food manufacturer Symingtons between 2007 and 2012. The team is led by current MD, Tim North, and Henrik Pade, the Marketing and M&A expert, who will become joint MDs as part of the deal. The team also includes existing management members Paul Kirby (Operations Director), Steve Whattam (Purchasing Director), Chris Dawson (Head of Sales) and Gosia Bilska Pietrasiak (Head of Technical)). Gavin Thomas (FD) will also join the team as part of the transaction and proven operator Nick Ward was introduced by Mobeus as Chairman.
Star Brands is headquartered in Leeds and has a manufacturing plant in Redditch. It currently employs around 125, with 30 of those FTEs added during the last 12 months.
The BIMBO is principally financed by Mobeus, with a layered debt and equity package.
Management was advised by Roger Esler and Paul Herriott of Dow Schofield Watts Corporate Finance (DSW) Leeds, who also introduced the transaction to Mobeus. Legal advice was given by Dahren Naidoo and Fiona Woodhead at Freeths, Leeds (Management) Mae Salem and Paul Mann at Squire Patton Boggs, Leeds (Mobeus). Due diligence was provided by RSM (Financial & Tax), BDO (Tax structuring), Pragma (Commercial) and Highwire Consulting (Management).
Ashley Broomberg, Partner at Mobeus, led the deal, supported by Dominic Draysey. Ashley commented:
“We are delighted to back a great management team at a great British company. This is the second time we have backed a manufacturing business based in the Midlands from our current fund – Britain still makes things and makes them extremely well. We look forward to supporting the team as they continue to provide flexible and innovative solutions to its grocery customers as well as develop exciting new product ranges for end consumers.”
“This is a really exciting time for the whole team at Star Brands who have grown the business over the past few years by listening to what our customers and consumers need and acting accordingly.
“To maintain this momentum, we all recognise the critical importance of constantly developing and evolving, and I really look forward to working again with both Henrik and Gavin and the added impetus I know their arrival will bring to the rest of the team. Having worked closely with Ashley and his team at Mobeus in concluding this deal I have been very impressed by their passion for the Star Brands business and see them as an excellent partner for the next chapter.”
Tim North, Star Brands MD