HMT LLP advised Redeem Holdings Limited (“Redeem”), the leading international provider of mobile phone and electronics recycling and recommerce services, on its recent £15 million fundraise.
Redeem is a global leader in the provision of recommerce, recycling and refurbishment of mobile and electronic devices, predominantly mobile phone handsets, for mobile network operators (MNOs), retailers and corporates. Redeem has grown revenues at around 50 per cent annually over the last four years, with sales expected to reach £90m in the current financial year. The vast majority of the traded-in devices that Redeem handles are data wiped, refurbished and resold into a growing number of end markets, which include European phone retailers, mobile phone retail shops and insurance companies. Devices are also sold in developing countries where consumers wish to access the latest products but are unable to afford new devices.
Connection Capital made a £5m equity investment in Redeem, with Praesidian providing a further £10m through a combination of debt and equity to support the group’s international organic growth plans and ongoing acquisition strategy.
Connection and Praesidian are backing a high-calibre management team led by Founder and Chairman Trevor Bayley, an experienced private equity professional who was a founding partner of HgCapital, and CEO Claes Svensson, formerly a Vice President at Sony Ericsson, responsible for Western Europe.
The mobile handset recycling market has taken off in recent years with the advent of valuable smartphones. The UK is leading this rapid development with the rest of the world also seeing increasing levels of growth in the sector. The market is mirroring the growth of mobile phones in the 1990s with new product launches driving awareness and growth. The recent launch of the iPhone6 is has led to a surge in the number of used handsets being recycled as owners of older models trade in against their new purchases.
Trevor Bayley commented:
“We are very pleased to have secured significant institutional backing to maintain our rapid growth. We selected Praesidian Capital and Connection Capital for their commerciality and have been delighted with the rapid delivery of a competitive funding package. We will continue to review our corporate funding options, including flotation, as we plan to treble in size over the next three years.
HMT were invaluable throughout the process, from their initial in depth understanding of our business to identifying the right funding partners, right through to a successful completion of the fundraise. We look forward to continue working with them as our advisors as we continue with our growth plans for the business”
Anthony Brennan, Partner at Praesidian commented:
“We are delighted to work with Connection Capital to invest in this excellent growth opportunity. We look forward to working with Redeem in a supportive capacity and as a long-term committed investor in a dynamic and growing UK business.
We would also like to thank HMT to introducing us to the Redeem opportunity and look forward to working with them again in the future.”
“Having previously advised Redeem on four acquisitions over the last three years, HMT were once again delighted to work closely with Trevor, Claes and the team in securing this £15m investment.
Funding will allow the group to continue its organic and acquisitive expansion across a number of key European markets and we look forward to continue working with them as they implement this exciting growth story.”