Spark Energy chief leads buyout of power supplier
The firm, which focuses on the rental and social housing sectors, said the MBO, which is “close to completion”, has also secured backing from four unnamed institional investors, including a UK pension fund, a European family office and a Middle Eastern investment bank.
Spark Energy, based in Selkirk, launched in 2007 and the company saw its pre-tax profits more than double to £3.4 million in the year to June 2015, up from £1.27m previously, on turnover 43 per cent higher at £118.6m. The firm said it was on course to grow sales to £125m this year.
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Hide AdThe value of the MBO has not been disclosed, but a spokesman said the deal would see Spark’s shareholders realise a return on their investments, while “significantly” increasing its access to growth capital. The support of 75 per cent of shareholders is needed before the offer closes on 14 July. If approved, the transaction is expected to complete the following month.
Gauld said: “This is the natural next phase in Spark’s evolution. Whilst we can be proud of our achievements so far, we have big plans for an exciting future.
“The new institutional backers have the extra financial strength and experience to enable us to fund and accelerate the next steps in our ambitious plans, and to realise our full potential.”
He added: “We are confident that this deal will go through and excited about the opportunities ahead of us. We have plans to diversify our offer, to invest further in customer experience and to consider acquisitions and technology that serve to improve our performance and the convenience we offer to the tenants, landlords, agents and social bodies we serve.”
Spark employs about 350 staff. Its chairman, Sir Timothy Noble, and his fellow non-executive directors will resign when the deal completes.
Noble said: “If, as expected, the proposals are accepted, I will depart my role at Spark with great pride in what we have achieved together, and with pleasure that my fellow shareholders will have been rewarded for the confidence and courage they showed in supporting this company.
“The success of Spark Energy is a fine example of angel investment in action. Without the support of so many private individuals and Scottish Enterprise, who together invested more than £15m over a period of years, companies such as Spark would not be able to get off the ground, as the banks and other institutions are not prepared to provide such risky finance.”