Duncan & Todd, one of Scotland’s largest independent optical chains, has secured a £3.5m follow-on investment from BGF and additional senior debt facilities from RBS to continue its growth and facilitate future acquisitions.
The business has recently purchased 20:20 Opticians, a six branch retail group, consisting of four sites in Edinburgh and two in Glasgow. The acquisition will increase Duncan & Todd’s retail footprint to 30 branches across Scotland and provides the business with a strong platform and brand name to expand further into the Central Belt.
The transaction was initiated by DLA Piper Scotland LLP who provided legal advice to the vendors, with Aequitas providing corporate finance advice. CMS Cameron McKenna LLP and Haines Watts Corporate Finance provided advice to Duncan & Todd. Maclay Murray & Spens LLP provided legal advice to BGF on the deal.
BGF originally invested £5.6m into Duncan & Todd in December 2013 taking a minority stake. Since then, Duncan & Todd has acquired Gunn & Galbraith, an independent optical store in Dunfermline in May 2014 and has recently completed a £1m upgrade of its manufacturing facility in Aberdeen, doubling the groups manufacturing capacity. The state of the art facility will serve Duncan & Todd’s own retail stores as well as providing market leading lenses to third party opticians and laboratories. Following this latest investment, BGF remains a minority shareholder in the company.
Patrick Graham from BGF, Duncan & Todd board member, said: “BGF is all about backing growing businesses and we saw that there was an opportunity in the optical market when we made our first investment at the end of 2013.
“Once we invest in a company we want to continue supporting management to grow their business so providing follow-on capital is a key part of our business model. This is an excellent investment for Frances Duncan and her team and will provide a significant step-change to the Duncan & Todd business.”
Duncan & Todd was founded in 1973 and has grown to become one of Scotland’s largest independent optical chains.
Frances Duncan, Managing Director, explained: “The funding from BGF has helped us to grow our business and the follow-on investment is now boosting our expansion across Scotland. There is good strategic rationale for this latest acquisition as 20:20 Opticians has a similar model to Duncan & Todd because it offers excellent service and great brands at competitive prices.”
“We are very excited about the future. Having a material presence in the Central Belt with the strong brand name of 20:20 provides a great platform for the business to continue its expansion across Scotland.”
Ms Duncan added: “As well as the cash investment, BGF has also offered advice to help us expand our manufacturing division. Mark Bryant, BGF’s head of manufacturing, has provided us with his invaluable expertise and experience and we are now in a position where we can start offering our wide range of lenses, in-house coating capabilities, and market leading turnaround times to our existing customers as well as other third party opticians and laboratories. ”