The latest acquisition deals in Welsh business

Here we feature the latest equity and acquisition deals in Welsh business.

Caerphilly-based Drone Evolution has secured equity backing from the British Business Bank’s £135m Investment Fund Wales as it looks to accelerate growth.

The company, which was set up in 2018, has secured a £850,000 investment from the £50m equity element of the fund from the economic development bank of the UK Government, which is funded managed by Foresight.

The nine-strong team, co-founded by business partners Clayton Earney, Toby Townrow and John Young, pilot drones and provide UK-wide consultancy services. Some of its key clients include multi national property management company CBRE facilities management venture Mitie, Caerphilly Borough Council, as well as delivering in-depth land surveys for EDF Energy’s windfarm projects.

Drones, or unmanned aerial vehicles (UAVs) are used to supply aid and food, water and medicine to areas Following the aftermath of Storm Dennis, Drone Evolution, was able to inspect infrastructure damage, problem areas and terrain conditions, to assist in the clean-up operation and to provide mapping and data collection.

Mr Townrow, business development director at Drone Evolution, said:“Much of our work is inspection and detection, as well as remedial work. We offer early analysis to prevent potential damage. Our drones are used to complete building, telecoms and typography land surveys, thermography and traffic monitoring. We have worked extensively on coal tip mapping and monitoring year on year for any shift or danger.

“We continue to work closely with local authorities to help reduce overhead costs. Our drones identify blocked drains or missing tiles on schools, to prevent leaks and damage.”

On its latest investment he added:“It was clear from our very first conversations with Foresight that we were compatible for Investment Fund for Wales support in unlocking the business’ true potential.”

Drone Evolution has patented a tethered quadcopter design drone, which can fly for extended periods. As they are powered by a cable, these drones benefit security operations in a temporary space including sports events or music concerts.

Mark Sterritt, director, nations and regions Investment Funds at the British Business Bank, said: “The Investment Fund for Wales was established to provide the financial backing that innovative and ambitious companies like Drone Evolution so often need and we are particularly pleased to support their expansion plans as they continue to scale.

“The Drone Evolution team is highly experienced, driven and passionate about this specialist, emerging sector, and they have already developed an impressive roster of clients. I’m looking forward to hearing more about what they do next following this significant investment.”

Ruby Godrich, investment manager in the private equity team at Foresight, said:“Drone Evolution is an ambitious, growing business with a passionate management team. Over the last few years, the team has grown a successful drone services division whilst also developing a range of products.

"! Foresight’s investment via the Investment Fund for Wales will help the company to further scale and in turn have a positive impact on the local economy through the creation of skilled jobs. We are delighted to be supporting Drone Evolution and look forward to partnering with the team on their exciting growth journey.”

The Development Bank of Wales is a minority equity holder in the business.

Llusern Scientific

University spinout firm Llusern Scientific, which has developed a rapid diagnostic test for urinary tract infections (UTIs), has been boosted with a six-figure equity round investment.

The Cardiff-based company - which spun out of the University of South Wales - has been backed by the Development Bank of Wales in its latest fundraise aimed at accelerating its commercialisation.

Since the start of the year the development bank has invested in six spinout firms with a combined value of £1.7m. The others include Swansea-based Corryn Biotechnologies and Grove Nanomaterials along with Awen Oncology, a spin-out of Bangor University and Cardiff University. Cardiff Metropolitan University spinout Kaydiar and Cardiff University spinout Optimise.ai

Llusern Scientific was established by microbiologist Dr Emma Hayhurst and molecular geneticist Dr Jeroen Nieuwland after they were awarded a discovery award from the Longitude Prize and UK innovation agency NESTA to develop an affordable diagnostic tool to combat antibiotic resistance.

They were later joined by biomedical engineer Professor Ali Roula and diagnostic professional Martyn Lewis to develop Lodestar DX, a molecular diagnostic test system for both humans and animals that is non-invasive and capable of providing highly accurate results in 35 minutes.

Chief executive of Llusern Scientific, Dr Hayhurst said: “UTI prevalence is rising with an ageing population and the increase in antibiotic resistant infections. The gold standard for UTI diagnosis is microbiological urine culture and, in the UK, millions of urine tests are processed and cultured each year. However, a major drawback of urine culture systems is the time lag of approximately two days between specimen collection and pathogen identification. Fast and accurate diagnosis, leading to a rational treatment, is essential to achieve a timely and effective therapy.

“Our rapid and easy-to-use UTI test-kits are fully developed and commercially available in the UK, with a real-world evaluation underway within the primary care sector. They decrease the time involved in getting an accurate diagnosis and provide clinicians with the evidence they need to make informed treatment decisions. We hope that this will improve antibiotic stewardship and patient outcomes, resulting in fewer GP visits and hospital admissions associated with urinary tract infections. The same principals apply to the veterinary market.

“However, we wouldn’t be preparing to take Lodestar DX to market without investment. Commercialising academic research requires the support of forward-looking funding partners like the Development Bank who can provide patient capital and access to an established ecosystem. It’s what will enable us to scale and grow.”

Harry George, assistant investment executive with the Development Bank. He said: “Supporting technology-focussed start-ups with high growth potential like Llusern is exactly where our equity funds can make a real difference. We look forward to working with Emma and the team to scale the business here in Wales.”

Carl Griffiths, technology seed fund manager with the development bank, said: “Boosting business innovation will help to drive sustainable growth and long-term prosperity. University spinouts often have high-growth potential which is why we are working closely with our partners in higher-education to ensure that capital is available to help bring University research to market and support commercialisation.

“Most of the university spinouts are clustered around the “golden triangle” of London, Cambridge, and Oxford but we want to strengthen the pipeline of spinouts in Wales, providing the funding necessary for them to commercialise research, grow faster and attract further investment. From the emerging AI sector to healthcare and life sciences, some of the world’s most valuable and best-known companies have been founded at universities.”

Dr Louise Bright, pro vice chancellor of enterprise, engagement and partnerships at the University of South Wales, said: “We are committed to fostering innovation and entrepreneurship and supporting the transition of research into real-world solutions. We are very proud of Llusern who are doing exactly that. This investment from the development bank reflects the potential of this venture to make a significant impact in its field, while also contributing to the growth of the regional and global economy.”

Do-It Solutions

Market leader in neurodiversity screening and assessment Do-It Solutions has been acquired by Lexxic.

Cardiff-based Do-It Solutions was established by Professor Amanda Kirby. The value of the deal has not been disclosed.

Do-It’s web-based profiler system solution is a neurodiversity, cognitive and well-being screening and assessment system. It has also developed a comprehensive suite of sector specific neurodiversity training resources helping organisations to further understand and embrace neurodiversity.

London-based Lexxic is a specialist in workplace neurodiversity assessment, training and accreditation services.

Cardiff-based Gambit Corporate Finance acted as lead advisor to the shareholders of Do-It on its sale. Legal advise was provided by Acuity Law

The Gambit team was led by Frank Holmes, Kate Jones and Sean David.

Mr Holmes, partner at Gambit and chair of Do-It, said: “It is an absolute privilege to have worked with the UK’s leading expert on neurodiversity and learnt so much about the impact profiler and Do-It’s associated solutions have on people’s lives, and the advantages these bring to willing employers organisations in both the private and public sector alike who can fully tailor support for individuals with diverse talents and skills - qualities increasingly vital in the modern workplace.”

Ms Jones, manager at Gambit Corporate Finance, said: “We are thoroughly delighted to have advised the shareholders of Do-It, one of the global market leaders in championing neurodiversity, well-being and inclusion, on its sale to Lexxic. This transaction highlights Gambit’s ability to identify and apply a tailored transition that meets all stakeholder objectives.”

Professor Kirby said:“The Gambit team have stood by me and the business for a number of years and have provided the most fitting and professional outcome via this union with Lexxic, a great success all round.”

Andrew McGlashan, corporate partner at Acuity Law, said: “Amanda and the team at Do-It Solutions have created something really special and we wanted this deal to reflect that. We have spent the last 18 months working closely with the shareholders to ensure that their objectives were met and that they were satisfied with the final outcome.”

Headquartered in Cardiff, Acuity Law has more than 150 lawyers. The firm’s ambitious growth strategy has seen it open offices in Birmingham, Leeds and Liverpool in recent years, adding to its presence in Bristol, London and Swansea.

NES Services Group

Deeside headquartered NES Services Group has acquired Versatile Telephone Marketing (VTM), based in Suffolk, as it looks to build its portfolio of businesses across the UK.

NES Services Group, which has five other subsidiaries covering environmental, parking and security enforcement, has added VTM to its stable with the telecoms business retaining its branding and safeguarding 15 jobs in the process.

VTM joins 3GS, National Enforcement Solutions, HSG Security, Enforcement Pro and Caledonian Enforcement Solutions to the umbrella of companies in the group. NES Services group director, Ashley Govier, said: “This is a hugely important acquisition for our business. We want to diversify in professional services for clients in the private, public and third sector. Also, we want to ensure our portfolio of businesses are spread across the breadth of the UK as we grow.”

On how the acquisition came about, Mr Govier added “We have used tele-marketing services and had a clear idea on how we could do it better. Luckily, we came across VTM who were passionate about what they did and our vision and values aligned,

“Acquisitions are part of our growth strategy so we would welcome any conversation with business owners who are looking to exit or see if their business can add value to a larger group.”