The latest equity fundraising and acquisition deals in Welsh business

Here we feature the latest equity investment and acquisition news in Wales.

A syndicate of 15 female investors from Women Angels of Wales (WAW) is helping to improve recycling rates of single-use plastic with an equity investment into Deeside-based Polytag.

With the backing of Collateral Good and Knop Ventures, Polytag has now raised £2.85m to help fund the growth of it pioneering tag and trace barcode technology. Its GS1 digital link QR codes allow brand owners and retailers in the food and beverage sectors to track packaging from the time it’s labelled to the moment it’s scanned at recycling centres. Trials are already underway with Ocado, Co-op, Arla, Aldi and Biffa.

Rachel Ashley, a director of Women Angels of Wales (WAW) led the syndicate of female angels, who also been joined by a further six male investors. Their combined investment of £100,000 was match-funded with £100,000 from the Wales Angel Co-investment Fund. Polytag also has the support of the Advanced Manufacturing Research Centre in Broughton.

Chief executive Alice Rackley said: “Our GS1 approved technology allows brand owners and retailers to see where and when their bottles are being recycled so that they can track recycling habits across the ��Ƶ. This is powerful data that no brand or retailer can access, allowing them to drive sustainability strategies, develop new campaigns and make recycling more rewarding for customers.

“But it doesn’t stop there; these QR codes also empower consumers with valuable product-level recycling information, supporting a sustainable circular economy. The support of our funders means that we now have the capital to make further investment in our technology and our resource, helping to scale the business as we accelerate our growth while improving recycling rates and increasing circularity.”

Mariana Gonzalez, principal at Collateral Good said “We are delighted to support Alice and the Polytag team on growing the multi-tenanted platform, which combines in-house designed hardware and software relying on GS1 standards. The technology is highly scalable and can be used for unlimited industries. The valuable insight into consumption patterns, market penetration and disposal information allow brands or retailers to understand their customers and encourage sales and recycling. The label is now seen as a revenue driver.”

Ms Ashley said: “Led by Alice, this is a team with a shared commitment to making a positive change for future generations with the development of a solution that will improve recycling rates of single-use plastic. They have achieved some impressive traction over the last year and we hope that the smart capital from our syndicate of business angels will now add further value to the business.”

Carol Hall, investment manager for Angels Invest Wales, said: “With match funding from the Wales Angel Co-investment Fund, this is a syndicate of business angels who are working together to share risk and knowledge while making a real difference to Polytag. It’s a win-win that benefits both the company and the investors who are bringing real value alongside Collateral Good Ventures and Knop Ventures as venture capital specialists.”

Set-up by the Development Bank of Wales in 2022, Women Angels of Wales is a business angel investment syndicate for women. Jointly supported by the Development Bank and the British Business Bank, the syndicate of 48 women can access co-investment of up to £250,000 from the £8 million Angel Invest Wales Co-investment Fund.

Bethan Darwin of Darwin Thompson acted for the angel syndicate and Wales Angel Co-Investment Fund.

HSG FM Group

Cardiff-based facilities management company, HSG FM Group, has further expanded with the acquisition of contract catering services firm Radish.

HSG FM Group, which was named the fastest-growing indigenous firm in Wales in the 2021 Wales Fast Growth 50 project, were advised on the deal by Cardiff headquartered corporate advisory firm GS Verde Group.

The acquisition of Luton-based Radish, the value of which has not been disclosed, is a strategic move to expand HSG FM’s rapidly growing catering division. HSG has revenues of more than £25m and employs over 500 staff. Last year it acquired Kent-based TCS Education Catering

Ashley Govier, director of HSG FM Group said: “This is an incredibly exciting deal as it continues to diversify our portfolio whilst taking a big step towards our strategic goal of a strong commercial network from South Wales to London and beyond.”

He added: “We are delighted to have completed this deal and are continuing to look for further targets as remain keen to grow through acquisition. We are grateful for the support of GS Verde and we have enjoyed working with their multi-discipline team to get this deal done.”

To support its expansion plans GS Verde has opened a new office in Gloucester. As well as its Cardiff HQ is also has offices in Bristol and Dublin and satellite offices in London and Oxford.

Harlech Foodservice

Food wholesale business Harlech Foodservice has acquired a rival.

The Gwynedd family-owned business has expanded with the acquisition of Pembroke Dock-based Celtic Foodservices. The value of the deal has not been disclosed. The move is part of an overall £6m plan from Harlech to create 150 new jobs and comes a few months after it opened a new depot in Carmarthen where 15 sales staff and drivers have already been recruited.

Over the last three years Harlech has revenues increase from £32m to a record £50m, with a £2m profit

With existing bases in Merthyr Tydfil, Criccieth in Gwynedd and Chester, Harlech said its expansion is being driven by the growing demand from customers in south west Wales, particularly in the hospitality sector.

As part of the deal 12 members of staff at Celtic Foodservices are transferring to Harlech, including director Jason Davies.

Harlech managing director David Cattrall said: “I am delighted we have successfully acquired Celtic Foodservice and this strategic acquisition is a significant step forward in our mission to expand our footprint into South Wales.

“Celtic Foodservice has built a strong reputation for delivering high-quality products and exceptional service to its customers.

“By integrating Celtic Foodservice into our operations, we are poised to deliver even greater value to our customers through an expanded range of products, improved logistics, and enhanced customer service capabilities.

“I am excited about the opportunities this acquisition brings and am committed to ensuring a smooth transition for all Celtic Foodservice customers and employees.

“Our combined resources and expertise will enable us to better serve the foodservice industry, driving growth and innovation.

“I am looking forward to welcoming Jason Davies and the Celtic Foodservice team to the Harlech family and working together to achieve new heights in the industry.”

“The acquisition of Celtic Foodservices is another new and important milestone our drive to provide a first class service to new and existing customers in every single corner of Wales.”

Port of Milford Haven

The St Brides Spa Hotel. (Image: Huw Jones Photography)

The Port of Milford Haven has acquired one of Pembrokeshire’s leading hotels as part of its diversification strategy.

The St Brides Spa Hotel in Saundersfoot will be managed and operated on its behalf by the Celtic Collection - whose portfolio also includes the Celtic Manor Resort in Newport, the Parkgate in the centre of Cardiff and the Ty Waterfront at Milford Haven which is also owned by the port company.

The value of the acquisition of the 34-bedroom hotel has not been disclosed. Over the last decade the port has been actively pursuing a strategy of reducing its dependency on the oil and gas sector. The value of the acquisition has not been disclosed.

The hotel acquisition comes after the port secured a new £40m funding line from HSBC to support diversification investment .The port, which has been granted freeport status alongside the port of Port Talbot - under the Celtic Freeport banner - is also looking to exploit commercial opportunities from new Crown Estate licences for major floating offshore windfarm projects in the Celtic Sea.

Chief executive of the Port of Milford Haven, Tom Sawyer, said: “We are proud to, once again, be partnering with The Celtic Collection to deliver another high-quality hospitality and tourism offer in Pembrokeshire. This latest investment in St Brides Spa Hotel allows us, through our partnership, to promote the fantastic coastal community of Saundersfoot and support Visit Pembrokeshire’s ambition for the county to become a top five ��Ƶ destination choice.

“Historically, we have been highly dependent on the oil and gas sector, a commodities market that is prone to fluctuation and outside of our control. However, over the last decade, though a diversification strategy focused on developing and building our business based upon high levels of expertise and excellent facilities, we have successfully created new opportunities in port services, renewables and engineering at Pembroke Port, and hospitality and tourism at Milford Waterfront.

“The continuing success and growth of St Brides Spa Hotel brings economic, social and cultural benefits to the whole of Pembrokeshire whilst at the same time strengthening the Port’s financial resilience.”

Blake Morgan

The corporate team at Cardiff law firm Blake Morgan advised on deals with a combined value of £380m in its last financial year, while reporting a strong deal pipeline. The 58 deals the team acted on its financial year to the end of April, 2024, included:

Legal and due diligence to Nantgarw-based global leader in workplace safety and compliance solutions, Alcumus, on its acquisition of net zero and ESG consultancy business, Planet First.
Advising private equity firm LDC on its equity investment into Cardiff-based tech-enabled shipping and marine vessel inspection business, Idwal Marine Services.
Advised the shareholders of Swansea-based Caswell Bay on its sale to Aryza, a leading software solutions provider for the financial services industry.
Advised shareholders of Cross Hands-based steel-framed building specialist, Shufflebottom, on its sale of Embrace Steel Group.
Advised equestrian equipment venture Finest Brands International, which has its manufacturing base in Cardiff, in selling a majority stake to Irish-based investment group TDL Media.

Blake Morgan were also active in institutional fundraising, advising on over 20 investment transactions in the past year. Notably, the team advised Caerphilly-based trekking tourism venture, Evertrek, in securing the maiden equity investment from the new £130m Wales Investment Fund from the British Business Bank.

James Williams, partner and head of the corporate team at Blake Morgan, said: “We have enjoyed an extremely busy period, which is a testament to our team’s dedication and our clients’ trust in us. The market remains robust, particularly in technology, life sciences, health and social care. Our deep experience and comprehensive support have been crucial in navigating several complex transactions.”