Jon Moulton controlled Better Capital – a private equity firm specializing in turnarounds, has acquired around half of social housing maintenance group Connaught – the business that went to administration after the group collapsed.
Better Capital, which owns the UK subsidiary of the Reader’s Digest magazine among other assets, said it has committed £15 million for the acquisition along with capital restructuring and working capital requirements.
The administration process of Connaught is expected to come to an end soon with two other transactions scheduled in the near future, people close to the developments revealed. Administrators at KPMG have been running the company since September.
Connaught’s lenders had infused fresh funds worth £15 million in September, but the company failed to gather the support of its lender for a new business plan, causing it collapse.
The parent company and the social housing division were placed in administration while the environmental and compliance units were ring-fenced and continued to trade normally. Both the units attracted the attention from 15 different business and private equity players.
The company’s lenders are expected to form a special purpose vehicle to acquire the environmental division while the compliance division will be broken up into two halves.
Lovell Partnerships – the affordable housing division of Morgan Sindall, acquired a majority stake in Connaught’s contracts and related assets division as part of administration, in last September.
Later in September Centrica took over the gas and electricity services business from Connaught Compliance. The names of the environmental and compliance businesses have been changed to Fountains and Santia, respectively since the takeovers.