H&H expands with acquisition supported by Clydesdale Bank

19 October 2015

H&H Group, one of the UK’s leading agricultural businesses, has acquired livestock auctioneers John Swan Ltd in a public to private deal supported by an £8 million funding package from Clydesdale Bank.

Based in Carlisle, H&H Group incorporates a diverse range of businesses servicing the rural business community across the south west of Scotland and the north west of England. Among the businesses in the group are agricultural and livestock auction marts, property and farming services and printing and insurance services.

H&H’s Harrison & Hetherington farmstock business dates back to 1870 with its Borderway Mart at Carlisle now one of the largest livestock sale centres in the UK. The company operates a further six marts, which together with its Carlisle site sell 120,000 cattle and 680,000 sheep annually.

The acquisition will extend the group’s geographical reach into the east of the country where John Swan runs busy auction marts at Wooler in Northumberland and Newton St Boswell in the Scottish Borders. It will also bring to £200 million the value of H&H Group’s sales across its various divisions.

H&H recently announced turnover had increased to almost £17 million in its latest financial results (year ending 30th June 2015).

Brian Richardson, Chief Executive of H&H commented: “This has been a long process but it is pleasing we can now announce the completion of the deal, which combines two companies with a long heritage in agricultural livestock. H&H is firmly focused on this sector and will look to develop throughput at the two sites, alongside providing its land agency and rural insurance services to the customer base at Swans.

“It is part of our strategy for developing the group as a broad-based business with a focus on the rural and livestock sector. We have a strong balance sheet and a fantastic team at H&H, the addition of John Swan and their team to our business will further strengthen our portfolio and provide new areas for us to develop and grow market share.”

The deal was delivered by Craig Stewart and Andrew Carson, Senior Directors in Clydesdale Bank’s Specialist and Acquisition Finance team.

Legal support was provided by Clydesdale and Yorkshire Banks’ external legal advisors, HBJ Gateley.

Euan Cluness, partner at HBJ Gateley said: “We are delighted to have been involved in this public-to-private deal in our role as advisors to the senior funder, Clydesdale Bank PLC. There are always significant legal complexities involved in bringing together two such large and established businesses, but deals like this demonstrate the value of debt funding in mergers and acquisitions activity where there is an established market, strong business strategy and a sound strategic logic to the transaction.

“By acquiring a business which fits so well with its existing business, H&H Group have created the opportunity to build a truly market-leading position and achieve its ambitions for growth.”

Craig Stewart said: “This was a highly complex deal, involving communication with a large number of shareholders and an extended legal process.

“We have provided significant funding to H&H over many years and we wished to continue that support by providing acquisition finance for this next step in H&H’s growth ambitions.

“It is extremely rewarding to have played such a significant role in the takeover. The deal is set to deliver important growth opportunities by boosting H&H Group’s geographical reach and strengthening its position as a leading livestock auction mart.

“We relished the challenge of delivering the deal and look forward to successfully supporting other businesses in their corporate finance transactions.”