Downton delivers

Downton: Delivering shareholder change - on time, in full

The Downton family wanted to realise the value in their family business while ensuring it continued to invest in their legacy. Investec offered a logical solution.

600
The size of Downton’s fleet
About Downton

Downton is one of the UK’s leading privately owned logistics firms, with a strong reputation for quality and delivery – providing the flexibility of a local business but with national reach. The Downton family successfully built and developed the business from a single truck to now over 600 trucks and 1,000 trailers over the course of several decades. The majority of customers are blue-chip leading brands across a variety of sectors and include Dyson, Pets at Home, Fever-Tree and AB InBev UK.

Case study 2019 What happens when the owners of a family business want to exit? More than 30 years after taking over and successfully building up the business their father had set up in 1955, the siblings who owned and ran Downton, one of the UK’s leading private logistics firms, decided they wanted to move on.

Andrew, Richard, John and Kate Downton wanted to sell to someone they could trust – who could handle day-to-day management, but who would also be a good custodian of the family name emblazoned on a 600-strong fleet of vehicles. And a key concern was the people employed in the business. 

Neil Wilson, MD, Polyco Healthline
Heath Zarin, Managing Director, EmergeVest

Investec is our partner, and we have an open and transparent relationship with them, communicating regularly about what is happening.

Preserving family values

Through contacts in the sector, the family met EmergeVest, a private equity firm set up in 2013 that is best known in the UK or its logistics investments. “We are businessbuilders with a good reputation for service and quality,” says managing director Heath Zarin. “Downton was attractive to us as it is a unique, strongly diversified logistics business of a scale that does not often come up as an investment opportunity.”

A vital factor was the shared values between the Downton and EmergeVest teams. They agreed on a gradual transition, with Zarin becoming chairman and the Downtons staying in their executive roles until a new senior management team had been recruited and settled in.

Zarin knew the next step was ensuring he had the right financing to support the growth strategy. For many banks this could have been a problem, given the new management team had not yet been identified, let alone put in place. However, Zarin wasn’t worried. 

Flexible financing for transition and growth

Investec has worked with EmergeVest on all its UK logistics investments, and the teams have an excellent working relationship. “Investec is our partner, and we have an open and transparent relationship with them, communicating regularly about what is happening,” says Zarin. “This is how both teams naturally work and we have built up a great deal of trust by being open.”

This level of trust meant the Downton family could dispose of much of their stake in the business, releasing the wealth that had been created over the decades for their families.

'This business is well positioned for future growth – with Investec as our financing partner by our side. They are great people to work with – intelligent, pragmatic and flexible – and we achieve many positive objectives by working with them.'

Investec proposed a combination of a cash flow term loan, property finance, and asset-based revolver. Importantly, the structure was tailored to Downton’s specific needs. “The focus is to “This business is well positioned for future growth – with Investec as our financing partner by our side. They are great people to work with – intelligent, pragmatic and flexible – and we achieve many positive objectives by working with them.” Heath Zarin, Managing Director, EmergeVest January 2019 build on Downton’s success, to grow the business further,” Zarin explains. “We knew the Investec team would come up with a structure and mix of elements that suits Downton well. The flexibility inherent in the finance package caters for working capital need and enables growth, which is crucial.”

Learn more about Asset Based & Cashflow Lending

Downton happy employee
The platform for a new generation

The Downton family has worked with Zarin to recruit their successors to top management roles. There is a new board of directors and many of the C-suite are in place. “We have great people lined up or who have joined, and have worked well with the Downton family to bring in the right people,” says Zarin. “And there were already some great people within the Downton business.”

Now Zarin and his new team are focused on the future. “We will carry on working with the same values that have characterised the business for the past six decades,” he says. “This business is well positioned for future growth – with Investec as our financing partner by our side. They are great people to work with – intelligent, pragmatic and flexible – and we achieve many positive objectives by working with them.”

‘‘Providing flexible funding for family owned businesses such as Downton to make succession happen and realise wealth is part of what we are set up to do, it’s part of our DNA,” explains Paul Rablen of Investec. “Backing great teams in relevant businesses means we can shape bespoke debt funding around the specific situation rather than offering something ‘off the shelf’. Investor EmergeVest is a trusted partner of ours, so we were always going to find a solution to help unlock the opportunity for both them and management.” 

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Downton case study PDF 2.11 MB

Everything starts with a conversation, so get in touch and see how our out of the ordinary thinking could help your business.

  • James Cullen

    James Cullen

    Growth & Leveraged Finance

    I joined Investec in 2006 to help build and launch our blended asset based and cashflow offering. Before this I spent 17 years with Lloyds Commercial Finance, in various roles, culminating in running the Southern half of the business. During My time there, I was instrumental in pioneering the use of ABL structures in UK M&A transactions.

  • Paul Rablen

    Paul Rablen

    Growth & Leveraged Finance

    My focus at Investec is on deal origination, structuring and execution of blended Asset Based & Cashflow lending transactions for growth companies, partnering directly with management teams, entrepreneurs and private equity sponsors. Deals led for Investec include NFT, Palletforce, Park Resorts, Hanmere Polythene and Downton Logistics.

  • Nicholas Buxton

    Nicholas Buxton

    Growth & Leveraged Finance

    My focus at Investec is on deal origination, structuring and execution of blended Asset Based & Cashflow lending transactions for growth companies, partnering directly with management teams, entrepreneurs and private equity sponsors. Deals I have worked on at Investec include NFT Distribution, Flamingo Horticulture, Freshpak Chilled Foods, Hanmere Polythene and Downton Logistics.

  • Chris Lamb

    Chris Lamb

    Growth & Leveraged Finance

    I joined Investec in March 2014, originally into the Private Bank Finance team, and subsequently moved into the Growth and Acquisition Finance team in November 2015. Prior to this I qualified as a Chartered Accountant with E&Y in the financial services division and more recently worked at Barclays in the capital markets division of the investment bank.

Everything starts with a conversation, so get in touch and see how our out of the ordinary thinking could help your business.

James Cullen

Growth & Leveraged Finance

I joined Investec in 2006 to help build and launch our blended asset based and cashflow offering. Before this I spent 17 years with Lloyds Commercial Finance, in various roles, culminating in running the Southern half of the business. During My time there, I was instrumental in pioneering the use of ABL structures in UK M&A transactions.

Paul Rablen

Growth & Leveraged Finance

My focus at Investec is on deal origination, structuring and execution of blended Asset Based & Cashflow lending transactions for growth companies, partnering directly with management teams, entrepreneurs and private equity sponsors. Deals led for Investec include NFT, Palletforce, Park Resorts, Hanmere Polythene and Downton Logistics.

Nicholas Buxton

Growth & Leveraged Finance

My focus at Investec is on deal origination, structuring and execution of blended Asset Based & Cashflow lending transactions for growth companies, partnering directly with management teams, entrepreneurs and private equity sponsors. Deals I have worked on at Investec include NFT Distribution, Flamingo Horticulture, Freshpak Chilled Foods, Hanmere Polythene and Downton Logistics.

Chris Lamb

Growth & Leveraged Finance

I joined Investec in March 2014, originally into the Private Bank Finance team, and subsequently moved into the Growth and Acquisition Finance team in November 2015. Prior to this I qualified as a Chartered Accountant with E&Y in the financial services division and more recently worked at Barclays in the capital markets division of the investment bank.

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