Eastlake Group merges with Work Inc in £8m deal to form new workplace interiors and services giant
Eastlake Group, the leading workplace interiors and property services company, today (Tuesday Sep 2) announced a merger with Work Inc Group, its biggest competitor, in an £8m deal funded by The Royal Bank of Scotland
The new company, branded Eastlake Work Group, will have a UK-wide presence and a combined turnover of over £75m this year, making it easily the biggest in the sector.
It will employ 500 people across its eight regional locations in East Kilbride near Glasgow, Leeds, Belfast, Manchester, Cardiff, Newcastle, Nottingham and London as well as having facilities management staff located on site with clients across the country. There are no planned redundancies.
Eastlake Group's CEO David Eastlake will be Eastlake Work Group's chief executive and majority shareholder, providing visible daily leadership for the company, with Work Inc’s chief executive Craig Eastwood having a strategic role as executive chairman.
The new company, which will be headquartered in East Kilbride with a second main office in Leeds , will have a portfolio of clients that is both a British and international corporate Who's Who, with Blue Chip names such as American Airlines, Deloitte, RBS, HBOS, KPMG, ITN, Channel 4, HSBC, Barclays, Unilever, BT, BP and Marks & Spencer.
The deal follows a year of record success for both Eastlake and Work Inc, with both companies having grown their individual 2007 turnovers to the £30m mark.
David Eastlake said: "Craig and I have known each other for many years, and in fact worked together earlier in our careers. We have kept in touch as our businesses developed, but it wasn't until we met up in May this year that the subject of Eastlake Group and Work Inc coming together developed.
“There are a number of similarities between the two businesses, both of which have been subject to MBOs in the last decade and grown both organically and via acquisition thereafter. We had operated successfully in the same sector, but geographically our core areas were in different parts of the UK - so together we cover the entire country. I am absolutely delighted that the deal has taken place, and I believe Eastlake Work Group can offer a tremendous value proposition to UK businesses.
“I know I speak for everyone on the new management team when I say that we’re very much looking forward to integrating the two businesses and maximising our performance and reach.”
Craig Eastwood said: "Our two businesses were meant for each other. It is remarkable how alike we are, both operationally and in ethos. Eastlake and Work Inc have grown their reputations by being customer-focused above all else. Eastlake Work Group will continue to operate in this way and I believe our customers are about to be provided with a truly remarkable service experience.
"Both David and I believe in creating and managing great places for people to work. We aim to make lives of people at work an enjoyment, rather than just a function of life. We passionately believe the quality of our work improves both people’s lives and the bottom line of organisations that employ them."
Jim McIntyre, RBS's regional director of corporate banking in the west of Scotland, said: “This was an excellent opportunity for us to support an existing RBS customer, a growing Scottish business and a key RBS supplier in its strategy to consolidate a highly fragmented market in the UK and Ireland. Eastlake has achieved considerable growth since the MBO four years ago and we are confident that the union of these two very impressive management teams will create a business that can benefit from its scale to reach new heights. Together, these businesses have the contacts, customer base, and order books to succeed in gaining even greater market share.”
Eastlake Group has pursued a strategy of growth by acquisition in recent years, supported by RBS. In August 2006, RBS provided senior debt facilities in support of the purchase of Calvert Morgan Ltd, a Belfast office furniture firm which is the market leader in Northern Ireland and has a presence in Eire. Less than 12 months later, Eastlake acquired Burdew Contract Furniture, a bespoke furniture manufacturer based in Leeds. Those acquisitions helped the company increase its turnover from £17.5m in 2005 to £30m in the most recent financial year.
It also has a growing presence in continental Europe and recently opened an office in New York, from which it is already servicing a number of large contracts in the US.
In addition to providing furniture and interior construction to the commercial market Eastlake Work Group will also provide a number of other services from design and consultancy, audio visual, relocation and move management and fully integrated and managed facilities management services.
Posted 2 September 2008
