The Company and Our Investment
In December 2007 specialist manufacturing company Plastics Capital Ltd successfully listed on the AIM market at a market capitalisation of £27m. The IPO generated a return for Octopus of 2.1x its initial investment and 41% IRR.
Octopus led a £3.1m equity investment into the niche plastics manufacturing group as part of an £11m financing round to support the acquisition of two businesses in November 2005. It has since supported the company with three further acquisitions, tripling the size of the business over the period to proforma revenue of £25m and profits of £5m.
"We have been one of the most active investors in the lower mid market since our inception just over three years ago, completing 23 deals. While there are inevitable ups and downs within any portfolio we are pleased with the overall performance. In fact, we recently calculated that they have on average increased turnover by over 40% each year for the first two years following our investment and profits by over 100% per year for the same period (in part driven by acquisitions). It has been heartening to see some of these success stories now coming to fruition with four successful realisations during the course of the year."
Chris Allner, Octopus Investments
