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Jul 2011 – The sale of Tangerine to Blackstone delivers a 4x return for GCP

A sweet return for Growth Capital Partners

GCP exits Tangerine, the UK’s largest independent confectionery manufacturer

Tangerine
Growth Capital Partners (GCP), the provider of flexible structured equity to UK SMEs, today announced the sale of its 40% stake in Tangerine.

Headquartered in Blackpool, Tangerine is the UK’s largest independent manufacturer of sugar confectionery and popcorn. It owns brands such as Butterkist popcorn, the iconic Barratt Sherbet Fountain and Dip Dabs, Henry Goode’s soft eating liquorice and Princess Marshmallows.

The sale to Blackstone Group represents a return of 4x over five years for GCP. This is the fourth realisation from GCP’s Fund II and its second exit this year. GCP closed its third fund, which was oversubscribed, at a level of £160m in May 2011.

Tangerine has expanded at an impressive rate since January 2006 when Growth Capital Partners backed a £10m management buy-in (MBI) of Toms Confectionery Ltd, later re-branded as Tangerine. Within the first two years of investment, Tangerine acquired two established confectionery businesses; Burton’s Confectionery in August 2006, followed by Monkhill Confectionery from Cadbury Schweppes in January 2008.

In the period from January 2006 to July 2011, Tangerine has quadrupled in size, increasing its turnover from £40m to £160m and its base of employees by 300% to 1,350.

In February 2011, Tangerine gained a top 20 place in the Sunday Times DeloitteBuyout Track 100, which ranks Britain’s 100 private equity backed companies with the fasted growing profits (EBITDA) over the last two years of available accounts.

Garrett Curran, partner with GCP commented:

“In just five years Tangerine has enjoyed stunning growth. It has quadrupled in size and consolidated its position as the UK’s largest independent private label sugar confectionary manufacturer, increasing the range of brands that it owns and the number of food retailers for whom it manufactures own brand products. This is a credit to its first rate management team and an endorsement of our approach to investing across the capital structure and in ambitious entrepreneurs. Tangerine still has enormous potential and we wish the management every success in their next stage of growth”.

Steven Joseph, chairman of Tangerine commented:

“Since 2005 we have worked closely with GCP and with their support and flexible funding approach, we have been able to grow Tangerine significantly organically andthrough acquisition. We are looking forward to working with The Blackstone Group who will help us to take the business to the next level of growth.”

GCP has made over 20 investments since inception ten years ago, including Wrap Film Systems, the owner of Baco Foil; Amor Group, a leading technology business focused on the Oil & Gas, Transport, and Public sectors; and Entec, a leading environmental consultancy.

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