Inflexion takes £45m minority stake in Mountain Warehouse

Mountain Warehouse

Inflexion Private Equity has invested £45m (€50.9m) to take a stake of around 20 per cent in outdoor clothing retailer Mountain Warehouse, valuing the group at £310m.

Inflexion, investing from its Partnership Capital fund, is backing a team lead by founder and chief executive Mark Neale, who opened the business in Swindon in 1997.

Mountain Warehouse has had a number of private equity backers over the years. 21 Invest sold the business to NBGI Private Equity, who made 6x money when selling to Icelandic investment vehicle Arev. LDC acquired a stake in Mountain Warehouse of around 25 per cent from Arev in 2010 before selling back to management and Neale in November 2013 in a deal worth £85m.

Despite a tough environment for retailers, Mountain Warehouse has continued to grow strongly, with sales climbing 22 per cent to a record £225.3m in the 12 months to 25 February 2018. The company has grown revenues for each of the last 21 years.

Mountain Warehouse employees 3000 staff in nine countries. It has 220 UK stores with a further 80 stores spread across Poland, Canada, Holland, Germany, Ireland, Austria, New Zealand and the US.

“It’s my firm belief that if you have the right products at the right price, in the right locations and provide great service people will keep shopping with you. It’s great that Inflexion share that belief and wants to help support the next phase of our growth,” Neale said in a statement.

Inflexion managing partner Simon Turner said his firm had been following the business for more than ten years and knew the management team well. Turner said Inflexion saw Mountain Warehouse as “an unrivalled brand” in the outdoor market.

Carl Wormald (who was previously with LDC and worked on the captive’s investment in the business in 2010), Edward Lynch, Nick Rosenberg worked on the deal for Inflexion.

Royal Bank of Canada, Addleshaw Goddard, EY and Pragma advised Inflexion on the deal. Mountain Warehouse was advised by Eversheds.