Case study

Capital Economics: Continued global support

Minority investment supports international expansion of respected research company.

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Sector
  • Support services

Capital Economics is one of the leading independent macro-economic research companies in the world.

Employees: >140

Deal type
  • Management buyout
Exit type
  • Private equity sale
Exit date

27/03/2018

Exit value

£95m

Current
  • Reinvested
Re-investment date

25/04/2018

The Team
LDC Region

Capital Economics is a globally-recognised macro-economic research company. The company offers award-winning macro-economic, financial market and sectoral analysis, forecasts and consultancy.

Operating from offices in London, New York, Toronto, Sydney and Singapore, Capital Economics has a team of more than 60 experienced economists. The business has gained an enviable reputation for providing original and insightful analysis to a diverse and distinguished client base.

International expertise

In October 2014, Roger Bootle and his management team took on support from LDC in the form of a minority investment to aid its international growth plan. The transaction enabled Capital Economics to widen ownership of the shares amongst its staff and supported succession planning.

Since then, the business has grown revenues through the launch of new services and new offices in New York and Sydney. It has also expanded the team to over 140 employees across its five locations.

LDC have professionalised things… Maybe we would have done a lot of this anyway, but it wouldn’t have come naturally to us.”
Roger Bootle, Chairman
Capital Economics

“We’ve brought in someone from outside – Bob Dowson (CEO), who manages much of the business day-to-day. We’ve introduced a new CRM system, we’ve moved buildings, we’ve opened two new overseas offices, we’ve introduced new products, we’ve rejigged the sales process, I could go on and on.”

Further growth

In March 2018, LDC exited its investment in Capital Economics in a sale to Phoenix Equity Partners, which acquired a controlling stake in the business.

Phoenix’s investment, which valued the business at circa £95m, was made alongside the existing management team and shareholders. The transaction provided a return for LDC of 2.5x money and an IRR of 43 per cent.

Only one month later, LDC completed a minority reinvestment in Capital Economics alongside Phoenix. This has allowed LDC to continue to support the management team on the next stage of the company’s growth journey.