Cinven to acquire JLA
Investment in critical asset solutions business in the UK
International private equity firm, Cinven, today announces that it has agreed to acquire JLA (‘the Group’), a leading critical asset supply and services business for laundry, catering and heating in the UK, for an undisclosed consideration.
Headquartered in Ripponden, West Yorkshire, JLA provides commercial laundry, catering and heating solutions to more than 25,000 small and medium-sized enterprise (‘SME’) customers. JLA offers a unique ‘Total Care’ proposition, which combines equipment supply with guaranteed service response times for a contracted monthly fee, providing peace of mind and value for money to a range of customers including care homes, hotels, education providers and housing associations. Founded in 1973, JLA employs around 900 people, including around 300 engineers.
Cinven’s Business Services team identified JLA as an attractive investment opportunity given its:
- Resilient business model: JLA provides critical services at attractive value for money to a stable and loyal customer base. It also benefits from recurring revenue through long-term contracts;
- Attractive markets: JLA services markets with attractive growth prospects including care homes, hospitality, and student accommodation;
- Strong positioning: JLA’s leading position allows it to offer national coverage with leading response times to its customers;
- Significant growth opportunity: JLA has significant potential for organic growth both in its existing businesses and though expansion into new services. It also has a proven track record of successful acquisitions, having acquired 16 companies in the past five years;
- Strong financial performance: JLA has delivered double-digit annual revenue and EBITDA growth organically and through acquisition since 2013; and
- Strong leadership team, led by Stephen Baxter, CEO, which has overseen JLA’s highly successful growth to date.
Rory Neeson, Partner at Cinven, said: “Under the leadership of its strong management team, JLA is a well-run, defensive business with a diversified and loyal customer base. We believe JLA has an excellent platform to support its further growth ambitions, including its national engineering platform and sales and marketing capabilities.
“Cinven’s strategy is to invest in JLA to support the Group’s organic growth – both in its existing core products of laundry and catering solutions and in new areas, including heating and fire safety. We also see a great opportunity for continued growth through buy and build.”
Daniel Tanase, Principal at Cinven, added: “JLA’s business model shares key characteristics with many of Cinven’s highly successful Business Services investments, for example CPA Global. Both companies provide mission-critical services to a diverse customer base and in growing markets, and benefit from long-term recurring revenue streams. Cinven invested significantly in CPA Global, particularly to develop its service offering which helped underpin its successful growth. JLA is a great opportunity to replicate this strategy.”
Stephen Baxter, CEO of JLA, commented: “Our focus as a company is on investing in innovative product offerings and expanding our business through both organic growth and acquisitions. We are delighted that Cinven is investing in JLA to support the next phase of our growth. The Cinven team has significant experience of investing in and building businesses in the UK and internationally and I am certain they will be instrumental in our future successes.
“JLA is proud of the strength and longevity of its customer and supplier relationships which have underpinned the growth of our business so far. We work hard to keep critical areas of our customers’ businesses running smoothly, safely and effectively – whether it’s in the laundry, kitchen or boiler room. Cinven has a reputation for its responsible approach to investment which I am confident will be a further positive for our business including our employees, customers and other stakeholders.”
JLA is the ninth investment from the Sixth Cinven Fund. This transaction follows Cinven’s most recent Business Services investments in Tinsa, a provider of property valuation, analysis and real estate advisory (in August 2016); and Hotelbeds, a global business to business bedbank (in September 2016). Both of these businesses are performing strongly and have undertaken successful buy and build strategies.
In the UK, Cinven’s current investments include NewDay, the UK consumer finance company (acquired in January 2017), and Kurt Geiger, the retailer of footwear and accessories in Europe (acquired in January 2016).