London-based Bowmark Capital, a mid-market private equity firm, merged two of its portfolio companies, Leaders and Romans, to form a property services group. The two brands will continue to operate autonomously. Bowmark backed the respective management buy-outs of Leaders in March 2010 and Romans in September 2013.
Bowmark Capital, the mid-market private equity firm, has merged Leaders and Romans to create a market-leading property services group, with more than 140 branches across the UK, and combined revenues of over £100 million.
The group will be one of the largest property services providers in the UK, with over 40,000 properties under management – as well as strong residential sales and professional services businesses. The group has branches in London, and across the South, East Anglia, the Midlands and the North West.
ICG has provided a substantial senior debt facility to support the merger and has committed a further £35 million to enable the new group to continue its successful buy-and-build strategy.
Both businesses have grown strongly since Bowmark backed the respective management buy-outs of Leaders in March 2010 and Romans in September 2013. Whilst the two brands will continue to operate autonomously, combining the expertise of Leaders in lettings with that of Romans in property sales will further enhance the service both provide to landlords, tenants, buyers and sellers. The merger will also enable the group to optimise its operational efficiencies and capitalise on the expected continued strong growth in the lettings and sales markets.
The UK lettings market is worth around £2 billion a year and is growing at 7% p.a., with increasing demand for rental properties driven by the growing population, the shortage and higher cost of housing, and the growing proportion of younger adults who see renting as a preferred lifestyle choice. Meanwhile, strong housing demand is expected to drive an increase in sales transaction numbers, with supply constraints pushing up house prices. The UK residential estate agency market was worth almost £4 billion in 2015 and is forecast to continue growing at over 8% p.a.
Bowmark partner Mark Salter said: “Leaders and Romans are outstanding businesses in their own right, and both have delivered impressive profit growth under our ownership. Bringing them together creates a leading lettings-focused property services group that is greater than the sum of the parts, and is perfectly positioned to capitalise on the positive market conditions.”
Paul Weller, Leaders’ Chief Executive, commented: “This is an exciting next step in the Leaders story since forming our successful partnership with Bowmark in 2010. We are looking forward to sharing expertise with Romans to take fullest advantage of the expected growth in residential sales and lettings in the UK.”
Peter Coles, Romans’ Chief Executive, added: “With Bowmark’s backing, Romans has continued to expand across the South East. The merger with Leaders gives us access to a national platform and deep buy-and-build expertise, creating new opportunities for both businesses as we enter the next phase of growth.”