Cumbrian laundry firm acquired at 2.5x turnover
Wed, 29 May 2024 | BUSINESS SALE
A laundry firm based in Cumbria has been acquired by a Canadian group in a deal worth up to £26.1 million. Shortridge Limited, which was founded in Dumfries in 1845, merged with Cumbrian company North West Laundry in the early 2000s.
The firm now has sites in Dumfries, Darlington and Workington, serving in excess of 1,200 independent hospitality customers. It has now been acquired by Canadian laundry giant K-Bro Linen, with the deal representing close to a 2.5x multiple of its revenue for the year to September 30 2022.
During that period, the company reported £10.5 million in revenue, up from £6.6 million a year earlier, and saw its post-tax profits increase sharply from £82,000 in 2021 to £974,000. At the time, its net assets were valued at £3.8 million.
K-Bro Linen is based in Alberta and was founded in 1954. The company is Canada’s largest operator of laundry and linen processing sites, with ten facilities and two distribution centres operating under K-Bro Linen Systems and Buanderie HMR brands.
The firm already owns Fishers, a Scottish laundry firm focused on the healthcare, hospitality, manufacturing and pharmaceutical sectors, which it acquired in 2017. Following the acquisition of Shortridge, it is targeting further expansion into the Midlands and southern England.
K-Bro president and CEO Linda McCurdy said: “While our original plans to grow our presence in the UK were interrupted by the COVID pandemic, we have stayed on the alert for further growth opportunities in the UK, and I am excited by the potential that this acquisition presents for us and for Shortridge's customers. We share the same values as Shortridge, so the cultural fit is strong and the business has found a good home as part of the K-Bro family.”
She added that the deal was a “great opportunity” for K-Bro to diversify its UK customer base and to position itself for ongoing UK growth as it seeks to extend its geographic presence further south.
FRP Corporate Finance acted as lead advisor to Shortridge’s shareholders on the deal, with FRP partner Matthew Flower saying the transaction represented “a perfect fit for both parties.”
He continued: “Not only does it allow the well-established and respected Shortridge name to live on and secure the future of its employees, but it also means that K-Bro can diversify its customer base, providing a platform for expansion further south into the UK.”
“It proves that there is sustained interest in high quality UK companies from international buyers as greater economic stability encourages more businesses to target growth opportunities through M&A.”
Despite ongoing challenging trading conditions, the UK remains the top destination in Europe for inbound and domestic M&A investment
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