The latest equity investment deals and news in Welsh business

Here we feature the last equity investment and related news in Welsh business.

Llantrisant-based Mallows Beauty is launching in 550 Superdrug stores throughout the UK and preparing to expand in to the US market following a six figure equity investment from the Development Bank of Wales.

The equity backing from the development bank is its third in Mallows since 2021 and takes its the total equity and debt backing to over £1 million. The fast growth business now employs 25 and is achieving run-rate revenue of over £5m in 2023/24 with a three-year compound annual growth rate (CAGR) of over 100%. Stockists include Oliver Bonas, Beauty Bay and Superdrug.

The Mallows product range includes shave butter, body scrubs, hair care, skin care and razors. Superdrug will now stock the shave butter and razors with more product lines expected to be added shortly.

Mallows Beauty was founded by Laura Mallows in 2020. She said: “With a focus on self-love, body positivity and female empowerment, our ethical products are made for real skin, and real bodies. We make people feel good and as we enter the next chapter of our growth, we’re feeling really positive about the power of our brand as a beacon of change in the beauty and skincare industry.

“The support from the Development Bank over the last three years has been fantastic. They’ve helped us to make the transition from start-up to scale-up, providing much-needed development capital and guidance that has made a real difference. We’ve now got the people, the processes and the funding that we need to increase production and accelerate our growth in the global skincare market starting with our products being sold in all Superdrug stores throughout the UK.”

Portfolio executives at the Development Bank of Wales, Kelsie Taylor and Sam Macalister-Smith, have been supporting Mallows. Ms Taylor said: “We’ve got a great working relationship with Laura and the team at Mallows and it’s been a pleasure to watch the business mature and grow over the last three years. They’ve demonstrated excellent profitable revenue growth and are seizing every opportunity to capitalise on the growing global market for natural skincare and beauty products.

“The contract with Superdrug is a major vote of confidence in the Mallows brand as the team continues to develop innovative and ethical products that promote well-being and positivity.”

Foresight

The fund manager for the equity element of the British Business Bank’s £130m Investment Fund for Wales is ramping its operation supporting the growth of Welsh SMEs.

Global FTSE 250 listed private equity and infrastructure investment manager, Foresight, was revealed as the funder manager for the fund’s £50m equity element last November. With a mandate to make investments up to £5m per deal it has already made its first investment from the fund with a £1.3m co-investment into Caerphilly-based adventure travel venture EverTrek. It has further deals in the pipeline.

Foresight has been based in temporary offices at Tramshed Tech in the Grangetown area of Cardiff, but will shortly move to permanent offices at the Southgate House office building in the city centre. To support Wales-wide deal flow it also has an office at M-SParc on Anglesey.

Stephen Galvin, previously a senior investment executive at Development Bank of Wales, was appointed as fund principal last November. Foresight’s Wales team has now been further boosted with Geraint McGrath recruited from Deloitte as senior investment manager and Ruby Harcombe, formerly of the Development Bank of Wales, joining as investment manager.

Mr Galvin said: “I’m thrilled at the progress our new Welsh operation is making. We’re here to address a funding gap for the provision of capital to SMEs in the country, and the positive response to the fund’s announcement last year – we’ve received over 300 inquiries so far – demonstrates that there is a strong demand for funding at the grassroots level and beyond.

“While we do have a certain focus on early-stage companies, our pipeline also includes later-stage business across various sectors including traditional industries like manufacturing.

“With the team now on board and a new office set to open later in the year, this is an incredibly exciting time – not just for Foresight, but for the wider business community here in Wales. We look forward to working with our partners in the region to help more companies achieve their potential while bringing a lasting boost to the Welsh economy.”

The large debt element of the Investment Fund for Wales is managed by the Development Bank of Wales, providing repayable finance ranging from £100,000 to £2m. Midlands-based BCRS runs the fund’s small loans element with a loan mandate ranging from £25,000 to £100,000.

James Technical Services

James Technical Services (JTS), one of the UK’s few remaining manufacturers of environmental test chambers, has become employee-owned.

The Talgarth-based business, which was established nearly 30 years ago, has been acquired by its staff via an employee ownership trust (EOT).

The deal, the value of which hasn’t been disclosed, was struck with Glen and Sue James who set up the business in 1995. JTS employs 10 people from its purpose-built factory and makes test chambers that can re-produce the harshest of environmental conditions, temperatures, humidity and vibration serving industries including aerospace, automotive, pharma and many more.

The couple were have been looking to retire, however, and thought they had explored all options before resigning themselves to closing down their successful business – until they came across the employee ownership model.

Now, twelve months on from starting the process of closing JTS, they have taken on a new managing director, David Hunter, and have ambitious growth plans to double their turnover in three years’ time.

The James’ will remain with the business in part-time roles during a transitional period.

Mr James said: “JTS is a successful business providing much needed jobs and skills in Mid Wales, but Sue and I had come to the point where we wanted to retire. We explored a trade sale, but we knew that we’d run the risk of the factory function being moved to another area.

“We thought our only other option was to close the business, which was a last resort as it is doing really well, but as we were winding down the business, we heard about the EOT model and realised it was perfect for us.

“So, we contacted Cwmpas who talked us through the process and set about making the arrangements for the EOT. We quickly realised that we’d need someone to drive the business forward under this model and so David Hunter joined the team as our new managing director.”

Development Bank of Wales

The Development Bank of Wales has confirmed Sally Bridgeland as its new chair.

Ms Bridgeland, who will take up her the role in September when Gareth Bullock completes his nine-year term as chair of the Welsh Government-owned development bank, holds a number of non-executive roles, including chair at Impax Asset Management Group plc and BelleVie Care, deputy chair of the Brunel Pension Partnership and non-executive director at insurers Pension Insurance Corporation and Royal & Sun Alliance.

During her recent career her roles included chief executive of the BP pension scheme, non-executive director at Royal London, and trustee and investment committee chair at the Nuclear Liabilities Fund, NEST Corporation and the Lloyds Bank pension schemes. She was chair of the first local government pensions pool, Local Pensions Partnership Investments Limited, from 2015 to 2023.

Having graduated with first class degree in mathematics from Imperial College she began her career with consultancy Bacon & Woodrow as an actuary.

Ms Bridgeland said: “The development bank is a unique resource for Wales; promoting innovation, increasing prosperity, and supporting the transition to a sustainable economy. It’s a development bank with a clear purpose and an excellent reputation for doing the right thing. I am looking forward to working with the board and wider team to maintain delivery excellence and support the long-term sustainability of the Welsh economy for the benefit of the people of Wales.”

Cabinet Secretary for Economy Energy and Welsh Language, Jeremy Miles, said: “I would like to welcome the announcement that Sally Bridgeland will be taking on the role of xhair at the Development Bank of Wales. She will join at a dynamic time, bringing a vast wealth of experience and unrivalled knowledge. I look forward to working with Sally on her appointment in September to continue to strengthen and grow the bank’s portfolio and build on the fantastic work which has already taken place over the past seven years.

“Sally will replace Gareth Bullock the current chair from September with the intervening period used to support an effective transition.”

Former Standard Chartered executive Mr Bullock said: “I am proud of all that we have achieved during the first seven years of the development bank. It has been a challenging period for Welsh businesses, but we have developed a reputation with customers and our wider network as a credible, trusted, and valued source of business funding.

“We have also made important strides as a responsible investor, increasing the supply of debt and equity finance with a social impact while promoting and advancing a greener future. I am sure that Sally will be welcomed by all at the Development Bank and given the support that she needs to help make Wales an attractive place to live, work and invest.”

Mr Bridgeland is also a member of the Royal Society’ advisory committee on mathematics education and chair of the strategic advisory board for the Centre for Mathematical Cognition at Loughborough University.

GS Verde

Corporate advisory firm GS Verde has expanded into Gloucestershire with the opening of an office in Cheltenham. The Cardiff-headquartered company also has sites in Bristol and Dublin, and satellite offices in London and Oxford.

The office - at Festival House in Cheltenham town centre - will be headed up by Joel Dunning, director of GS Verde’s tax and accountancy division.

He said: “We are excited to bring GS Verde’s unique multi-discipline offering to the Cheltenham and wider Gloucestershire area. We are already acting for a number of clients in sectors that are indigenous to Cheltenham, such as cyber-tech and manufacturing, and we are excited to grow this further in the coming months and years.”

In January, GS Verde secured a seven-figure investment to support its expansion plans after being admitted to secondary markets platform JP Jenkins. The fundraise gave the firm a £9m post-money valuation.

The group, which combines a number of professional advisory services across law, tax and accounting, corporate finance and communications, said it was looking to build on an existing base of existing clients in the Gloucestershire area.

Mr Dunning added: “We feel what GS Verde offers is unique and with a growing client-base in the area, we saw this as a catalyst to put down roots and expand within Clockwise Offices, with a thriving community of members.”David Dulieu, the group’s chief commercial officer, added: “We have grown our business both organically and through acquisition in recent years, and as we extend our offering across the UK, Ireland and further afield, the Cheltenham base is a natural and exciting next step for GS Verde.”

Last year, the group launched in Ireland with a Dublin-based acquisition, forming GS Verde Ireland.