MBO of Silverwing

The Industrial Products team at Transcend Corporate has advised new company, Project Spa Limited, on the £7.5m management buyout of Silverwing Group (“Silverwing”).

Silverwing designs and manufactures a wide range of Non-Destructive Testing (“NDT”) solutions which inspect storage tanks, vessels, and pipework for corrosion and wall loss, specifically for the petrochemical industry.

The management buyout, which was originated by Transcend Corporate approaching the vendors on behalf of the team, was funded through a combination of equity provided by NVM Private Equity, and bank debt from RBS. NVM invested a total of £6 million for a majority stake.

Silverwing was founded as a service inspection company. By 1992 the company had manufactured its own Magnetic Flux Leakage (“MFL”) floor scanner used to detect under floor corrosion in large petrochemical storage tanks. In 2000 the company restructured under the name Silverwing (UK) and established Silverwing Middle East LLC in 2006 followed by Silverwing Africa PTY in 2009. As part of the management buyout the three businesses will be brought under one new company umbrella, Project Spa Limited.

Silverwing is now a recognised brand within the international tank storage market, and is ideally placed to launch further products across different industries. Since 2006 it has successfully increased its revenue by 244%. Silverwing is headquartered in Swansea, Wales and currently employs 35 people in the UK and 27 in Dubai and South Africa.

Following the management buyout Wayne Woodhead, Managing Director of Silverwing, commented “Silverwing is well placed to take advantage of the international demand for our advanced NDT systems. With the support of NVM we can now develop integrated solutions, rather than individual products, and meet the needs of a range of corrosion mapping applications. The growth in infrastructure across emerging markets in Asia, Africa and the Middle East is driving demand for these types of solutions, as well as increasing health, safety and environmental legislation in established markets. Transcend Corporate did an excellent job supporting management on this transaction, from helping us negotiate the terms with the vendor, supporting us in the preparation of a Business Plan, structuring the transaction, managing the process, and successfully executing it. The management team is delighted with the outcome and we look forward to guiding Silverwing through to its next stage of development”

Commenting on the deal Transcend Corporate Director, Ian Curtis, said “Silverwing is an exciting niche technical manufacturing company which, despite the global economic downturn, continues to flourish. This is a great example of how the Industrial Products Team at Transcend can help all stakeholders achieve their objectives, which on this deal included the existing Shareholders, Private Equity and Management, whilst safeguarding the continued development of the business.”