Charterhouse exits Card Factory

Charterhouse Capital Partners LLP has sold its stake in Card Factory plc to unnamed investors. No financial terms were disclosed. Based in the UK, Card Factory is a greeting cards and gifts retailer.

PRESS RELEASE

London, 31 March 2015: Charterhouse Capital Partners LLP (“Charterhouse”) today announces that it has fully exited its investment in Card Factory plc (“the Company”), selling its remaining 60,609,953 shares in the Company to a number of institutional investors.

Founded in Wakefield in 1997, Card Factory is the UK’s leading specialist retailer of greeting cards, dressing and gifts. From its roots as a local business in Yorkshire run by a sole trader, the Company has grown into a clear market leader and following a share price increase of over 30% since IPO in May 2014 now has a market capitalisation of over £1bn and a position in the FTSE 250. Today it has 764 stores around the country, two transactional websites and provides over 6,300 jobs for the UK economy.

Charterhouse purchased the Company in 2010 for around £350mn and worked in partnership with the incumbent management team to grow the business significantly. This approach saw the Company open circa 280 new stores, develop its in-house card printing facility, and build a new corporate headquarters and two new warehouses during Charterhouse’s ownership.

In 2011 the Company purchased www.gettingpersonal.co.uk, a growing online personalised gifts and cards provider, to support Card Factory’s online distribution. Since acquiring the business, the EBITDA of this division has more than trebled.

Across the period of Charterhouse’s investment, Card Factory’s EBITDA increased by over 60% and the Company created over 3,000 new UK-based jobs. The improvement of the Company’s infrastructure means the business is well positioned for future growth.

Graeme Coulthard, Partner at Charterhouse, said:
“We saw a great deal of potential in Card Factory back in 2010, with its experienced leadership team, defensible market position and high-quality fundamentals. It has been a pleasure partnering with management to unlock that potential and build a company that is a true success story for the UK economy. We wish Card Factory the best of luck for the future.”

Richard Hayes, CEO of Card Factory, said:
“Over the past five years we have enjoyed a very good working relationship with Charterhouse. They have been supportive of the Company’s strategy and where appropriate have offered good advice and ideas which have helped us to realise our ambitious growth strategy. Going forward we remain well placed for future growth.”

About Charterhouse Capital Partners LLP
Charterhouse is an independent private equity house and is one of the longest established private equity firms operating in Europe.
The firm focuses on investing in companies headquartered in Western Europe, where it can work closely with the incumbent management team, backing them and providing active support to drive growth.

Charterhouse pursues a highly selective investment approach and tends to partner with a small number of high-quality companies that have good defensive strengths. It targets transaction values ranging from €250mn to €2bn.

Charterhouse is based in London and operates a one team, one office collaborative culture, with a deep bench of experienced partners. Its investment executives have worked together for an average of more than 10 years and within the investment team there are seven nationalities and eight languages spoken.

Since inception Charterhouse has completed over 140 transactions worth an aggregate value of over €50bn. www.charterhouse.co.uk

About Card Factory
Card Factory is the UK’s leading specialist retailer of greeting cards, dressing and gifts. It focuses on the value and mid-market segments of the UK’s large and resilient greeting cards market, and also offers a wide range of other quality products, including small gifts, party products and gift dressings, at affordable prices. Card Factory principally operates through its nationwide chain of over 750 Card Factory stores, as well as through its online offerings: www.gettingpersonal.co.uk (which sells personalised cards and gifts) and www.cardfactory.co.uk (which sells a selection of the products available in Card Factory stores).

Card Factory commenced operations in 1997 with just one store and has expanded its store estate primarily through organic growth into a market-leading value retailer with a nationwide presence.

The Group’s stores are in a wide range of locations including on high streets in small towns through to major cities, shopping centre developments, out-of-town retail parks and factory outlet centres.

Over the last 10 years, Card Factory has developed a vertically integrated business model with an in-house design team, an in-house printing facility and central warehousing capacity of over 360,000 sq. ft. This model differentiates the Group from its competitors by significantly reducing external costs and adding value to customers in terms of both price and quality, underpinning the Group’s motto: “compare the quality, compare the price”.