A North East industrial equipment supplier has undergone a management buyout with the help of a £4.25m injection from private equity investors.
RS Industrials (North East) Ltd, which has sites in Gateshead and Billingham and specialises in servicing, repairs and maintenance of hoists and gantry cranes, and was set up by Mike Riley and Neil Sanderson in 2001. The pair are now stepping back from the business as Mark Cawley and Phil Heathcock have joined as CEO and CFO respectively.
The deal has been backed by Foresight Group, which plans to support the new management in a growth strategy that has already seen the recruitment of seven engineers. RS supplies manufacturers across the North East and is said to have grown since a relocation in 2006, supported by loans from UK Steel Enterprise, which allowed it to open engineering supply shops at its Tyneside and Teesside sites.
Read more: Gateshead's Aspire Technology Solutions seals deal for Scottish firm
Read more: North East leisure operator Stack seals investment from Kings Park Capital
The firm has evolved over 22 years from solely overhead crane maintenance and repair to supply and inspection of lifting equipment as well as supply of tools and safety equipment including PPE, hand tools, power tools, janitorial products and height safety gear.
Mark Cawley, CEO of RSI, said: "I have thoroughly enjoyed working with the Foresight team to help secure the long-term future of the business. Foresight’s expertise in supporting SMEs will be pivotal in taking RSI to its next phase of growth. This significant investment will allow RSI to continue to create highly valuable skilled jobs in the area while ensuring our customers continue to receive an unrivalled service."
Tavia Sparks, senior investment manager at Foresight, said: "We are delighted to be working with the team at RSI. We are excited by the growth we’ve seen and we believe RSI represents a compelling opportunity. In the sector that RSI operates, safety is of paramount importance and RSI’s reputation for quality, which it has developed over its 20-year history, means it has an enviable portfolio of long-term, repeat customers. As such, the potential for further growth is significant.
“This is an investment made possible by our presence on the ground in the North East and it represents what we’re trying to achieve with our fund dedicated to the North East and Yorkshire – that is supporting promising SMEs with significant growth potential to deliver both positive economic and societal returns.”
The investment by Foresight is its 20th in the 2023 calendar year and comes alongside a number of follow-on investments across its venture capital, growth and buyout, and private credit strategies. Its £90m North East fund provides equity investments of up to £10m for companies across all sectors with headquarters or significant operations in County Durham, East Riding of Yorkshire, North Lincolnshire, North Yorkshire, Northumberland, Tyne and Wear, Teesside and West Yorkshire.
