FRP guide Fargro through successful MBO

Background

West Sussex-based Fargro Limited is the UK’s largest, leading authority in developing and selling biopesticide solutions, integrated pest and disease management, and other specialist products to horticultural growers and amateur gardeners. Although initially negatively impacted by the closure of garden centres due to COVID-19, the company was able to continue its 75 years of success, capitalising on the increased consumer demand for gardening supplies.

Fargro had previously recruited a new management team to take it to the next stage of its development and therefore needed to raise new capital, so the team decided to embark on a management buyout (MBO), and engaged FRP to raise the necessary equity and debt, as well as project manage the transaction.

Action

FRP’s Debt Advisory and Corporate Finance teams worked together, combining specialist expertise, which helped select the right debt funder for the MBO and conduct an extensive search of the private equity market. Our Corporate Finance team identified the best equity partner for the transaction, negotiating the deal and reviewing the relevant legal documents, whilst our Debt Advisory team advised on the most appropriate debt structure, reviewed the banking documents and helped to negotiate the key commercial terms in the banking documents.

Outcome

Our teams were able to successfully raise a significant amount of equity and debt finance, not only to fund the MBO, but also to enable the company to immediately pursue an acquisition opportunity.

“FRP have really demonstrated their worth. The uncertainty pre and post-Brexit, followed by a pandemic, were challenging conditions to seek a private equity partner and the accompanying asset-based lending facility we needed to implement an MBO.

“It was immediately a great working relationship with the team – their experience and advice in structuring our proposal was invaluable. They were able to guide me and my team through a complex process and found us the ideal PE sponsor and funding partner.” Richard Hopkins, Managing Director at Fargro.