West Midlands-based Grove Industries has acquired one of the UK’s leading direct marketing services companies, for an undisclosed sum.
GI Solutions Group Limited (GIS), which has 170 employees in Leicester & China, 158 of whom are Leicester-based, and annual sales of around £30 million, has been in the direct mail, database marketing, loyalty and outsourcing business for 16 years latterly focusing on added value solutions in customer value management.
The GIS marketing business supplies many of the leading users of direct marketing in the UK with a broad range of direct mail, database marketing and innovative printed products.
GE Capital and the commercial banking arm of Alliance & Leicester funded the deal, which will see West Midland industrialist David Grove becoming chairman of GIS.
The business, which has a history of technology leadership in the field of direct marketing, will continue to be run by the existing management team. All senior management remain in place under the new ownership.
Mr Grove, chairman of Grove Industries, said: “The GIS business is profitable, with high manufacturing standards, strategic customer insight services, excellent customer and supplier partnerships and a real understanding of customers’ needs.
“It also has what we believe to be an unparalleled expertise in digital printing and customer communications, which will allow the business to grow substantially going forward.
“We are investing in a high quality business with substantial growth opportunities.”
Mr Grove said GIS’s highly-skilled and experienced workforce was a likely key driver for further product and sales growth.
“As investors, we believe that we can add value through encouraging, supporting and working alongside the existing management,” said Mr Grove.
“Our track record is one of being willing to take a much longer view than many private equity investors and contributing much more than just finance.
GIS managing director Robin Welch said: “New ownership has given us an even stronger commitment to the strategy that is right for us, as well as finance for further product development and investment.
“We will be well placed to build on our existing strong platform. With the support of Grove Industries, we look forward to an exciting future focusing on our customers’ needs and bringing new products and services to market in the coming years.”
The deal has been completed at a time when the recent banking crisis and the threat of recession have had a major impact on the corporate scene.
But Mr Grove believes that the GIS purchase shows that there are still many strongly performing companies to be found, where a change of ownership can be beneficial to fuelling future growth.
The GIS deal is the second by the Grove Industries group in recent weeks. It follows the purchase of the Norfolk-based plastics packaging supplier Camvac from the global packaging giant Amcor.
“A secure source of equity and other finance going forward and a clear strategic commitment are more important than ever in the current environment if companies are to be encouraged to focus on growing and developing their businesses.” Mr Grove said.
“Even in the current climate, we are able to source and provide long term and working capital finance to back the purchase of good businesses at the right price.”