Key Capital Partners (KCP) has backed the buy-in management buy-out of premium street fashion business, Sabotage Limited, in a £3.6 million deal. The investment from KCP also includes an element of development capital.

Trading as Fly53, Sabotage Limited designs and sells premium branded street fashion for men and women. Founded in the mid-90s by Will Rigg, Sabotage has grown Fly53 from a limited edition T-shirt collection into one of the UK’s best-known independent fashion labels.

Selling across the UK through independent fashion retailers, key multiple fashion retailers such as House of Fraser and Scotts, and via online retailers including ASOS, Sabotage has recorded substantial sales growth in the last few years.

The primary wholesale business will now be strengthened by a broadened product offering and substantial marketing initiative. The company also aims to become a multi-channel operator by investing in its online retail offering, rolling out a series of concessions, and opening a select number of standalone stores in the UK. Sabotage, which already sells into Japan, Australia, Canada, Russia and Europe, also plans to further expand its overseas sales and distribution channels.

Founder and original shareholder, Will Rigg, is joined by a MBI team comprising Managing Director, Simon Smith, and Finance Director, John Bailey. Simon and John formerly worked at World Design and Trade Co Limited as Fullcircle Managing Director and Group Finance Director respectively. Will Rigg will continue in the role of Creative Director at Sabotage.

KCP partner, Mike Fell, also joins the board of Sabotage as a non-executive director, and has appointed a KCP operating partner as interim chairman.

Mike Fell said: “Despite the economic downturn and the resulting impact on discretionary spending, men’s fashion continues to experience strong growth, particularly in the area of branded streetwear. Having gained significant brand traction over recent years with Fly53, Sabotage is predicting 40 per cent growth in revenue for 2009, thanks largely to its plans to increase online sales through its own website and via other channels. We look forward to working with Simon, John and Will to realise their ambitions for the business.”

Alongside the investment from KCP, Sabotage’s existing majority shareholders, Harvey Jacobson and the Jacobson family, have also rolled over their exit proceeds from the business in order to continue to support the management team’s business plan. Harvey Jacobson commented: “I am delighted to retain a shareholding in Sabotage. The introduction of new investing management and the involvement of Key Capital Partners will now enable the brand to expand and realise its full potential.”

Simon Smith, Managing Director at Sabotage, added: “Since launching Sabotage in the mid-90s, Will Rigg has developed Fly53 into one of the UK’s leading premium street fashion brands. With the investment from KCP, and the ongoing support of Harvey Jacobson, the management team now plans to draw on its experience of building leading fashion brands to further develop the presence of Fly53 into a multi-channel fashion brand, both in the UK and internationally.”

Keith Watson, a director of luxury leather goods brand, Aspinal of London, advised the management team on the corporate finance elements of the deal.

Advising KCP on the deal were Malcolm Friend and Leon Rowley at Friend LLP, who conducted financial due diligence. Carol House of Whitehead Mann provided management due diligence services, while Patrick Woodall of Pragma Consulting conducted commercial due diligence. KCP operating partner, Bob Johnson, provided IT due diligence services on the deal.

Sean FitzGerald and Vicky Zivkovic led a team from Cobbetts LLP, which provided legal advice to KCP. Paul Osborne and Sean Williams from Fox Williams advised management, while Ingar Woolhouse of Harrison Clark advised Will Rigg. Reuben Berg and Russell Bateman at Berg Legal advised Harvey Jacobson.

 

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