Sovereign Capital announces the £21 million institutional buy-out of leading UK funeral directors business

Sovereign Capital Limited ("Sovereign Capital") the independent mid-market UK private equity provider announces that it has completed the £21m institutional buy-out of Laurel Management Services Limited ("Laurel"), a leading UK group of funeral directors.

The total funding comprises £17.4m to finance the IBO plus a further commitment to fund the group's expansion by organic growth and acquisition. Royal Bank of Scotland has provided the debt funding.

Laurel currently operates 29 funeral homes in regions including Kent, Hampshire, Hertfordshire and the Midlands. The group, which is one of the largest group of funeral directors in the UK, performs around 5,500 funerals a year in what is a highly fragmented market.

Paul Babington, who has over 30 years experience in the industry, will become Laurel's new Managing Director. Ron Trenter, Chairman of CVS (UK), Oasis Healthcare and Pursuit Dynamics plc joins as Executive Chairman. Graham Hodson, who has been CEO for the last eight years, will remain on the board as a non-executive director.

Sovereign Capital also has an investment in Westerleigh Group plc, one of the leading independent UK crematoria companies.

Commenting on the IBO Peter Brooks, Managing Director, Sovereign Capital said:

We are delighted to have the opportunity to acquire Laurel. The group has earned an excellent reputation for providing a sensitive and caring service - an approach that will firmly remain. Sovereign has a particularly strong track record in buy & build strategies, which makes Laurel a particularly attractive investment opportunity. The group has grown consistently over the last eight years and the enhanced management team will continue to build upon the group's strong foundations.

Paul Babington commented:

I am delighted to be joining the management team. Laurel is a first class business which has been built with a focus on providing clients' requirements at what is a very difficult time in their lives. I look forward to helping grow the group and building upon the client offering.

Mat Bhagrath, partner at Grant Thornton Corporate Finance, who initiated and advised on the deal, said: "Laurel is one of the most attractive businesses in what is a considerably fragmented sector. This acquisition provides Sovereign Capital with an excellent platform from which to build and capitalise on some excellent opportunities we are seeing develop within the funeral directors' market."