Duke Capital exits Fabrikat with 36% IRR and equity gain

LONDON, UK: Duke Capital Limited, a leading provider of hybrid capital solutions for SMEs, has announced the successful exit of its investment in Fabrikat, a UK manufacturer of street lighting columns and guard rails. The exit delivers an internal rate of return (IRR) of 36% for Duke, with the possibility of further gains from deferred consideration.

Duke Capital had invested £6.2 million in Fabrikat three years ago, enabling the management team to buy out the previous owners and become majority equity holders. Since then, Fabrikat has performed impressively, increasing its revenues and profitability. As a result, Duke has realised a significant equity gain on top of its core private credit return.

Fabrikat is being acquired by Metalogalva, a Portuguese engineering and steel protection company with a global presence. This is the eighth exit for Duke since its inception, and the proceeds will be used to fund new and existing investments.

Neil Johnson, CEO of Duke Capital, said: “Fabrikat is a real success story for Duke and a great case study for why Duke’s capital is a perfect fit for individuals seeking to execute an MBO. Our capital allowed long-standing employees of a strong business to step up into large equity ownership positions and in that role, they continued to prove themselves as great stewards of the business, creating value for all stakeholders. In turn, we are pleased to build on our already robust track record of achieving above-average returns on exits.”

Paul Allen, CFO of Fabrikat, said: “We would like to thank Duke Capital for buying into our vision in a way which motivated us to drive significant growth in the company. Duke’s capital enabled us to execute the MBO while the team supported us by becoming partners in our growth and success.

“Initially we went through a very competitive process but only Duke Capital’s offer allowed us to keep 70% of the business that we had spent years crafting as the senior management team. And to top it off, we were able to keep control of the timing of the sale and the counterparty to whom we entrust the future of Fabrikat and our employees.”

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