A long-established Merthyr Tydfil manufacturer has completed a management buy-out (MBO) backed by the Development Bank of Wales, securing the future of 65 jobs and continuing nearly four decades of local ownership.
Design & Supply, a specialist manufacturer of industrial steel doors, has been acquired by an experienced internal management team comprising Tom Grother, Scott Davies and Damien Regis. Notably, Scott Davies began his career with the business as an apprentice more than 25 years ago.
The £3.1 million deal was supported by £1.9 million from the Wales Business Succession Fund and a further £1.2 million from the Wales Flexible Investment Fund, which includes a mixture of equity and debt.
Founded in 1986 by Terry Stares, Design & Supply has remained rooted in South Wales throughout its history. The business was previously subject to an MBO in 2016, when long-serving employees Kevin Edwards and Chris Weed acquired the company. This latest transaction represents a continuation of that legacy, ensuring the company remains locally owned and led.
Employing 65 people from its 41,000 sq ft facility in Merthyr Tydfil, Design & Supply manufactures a wide range of high-specification steel doors, including fire-rated, security-rated, acoustic and flood-resistant products. The company serves customers across the UK, with projects including St Pancras, National Grid sites, Harrods, Canary Wharf and Silverstone.
Legal advice to the vendors was provided by Knights, with Darwin Gray advising the MBO team and Blake Morgan advising Development Bank of Wales. As part of the transaction, fractional finance director support is being provided by SME Finance Partners to support the business's next phase of growth.
Tom Grother, Director at Design & Supply, said:
“This is a proud moment for all of us. As a management team, we've been closely involved in running the business for many years, and this deal gives us the platform to take it forward while staying true to what's made it successful.
“We're particularly proud that this is the second management buy-out in the company's history. It reflects a strong legacy of local ownership and long-term commitment to the business, its people and the wider community. Scott's journey from apprentice to owner is a great example of what that means in practice.
“The support from the Development Bank of Wales has been about much more than funding. We've built a strong relationship with the team, and their backing gives us confidence as we look to the future. Our focus now is on building on the foundations laid by Kevin and Chris, continuing to invest in our people and delivering long-term, sustainable growth.”
Scott Hughes, Senior Investment Executive at the Development Bank of Wales, said:
“This investment demonstrates our commitment to supporting strong Welsh businesses through succession using equity investment.
“Design & Supply is a highly regarded manufacturer with an experienced management team and clear growth ambitions. By backing this transaction with equity, we are helping to ensure continuity, safeguard skilled employment in Merthyr Tydfil and support the business to invest for the long term while remaining locally owned.
“We're pleased to support Tom, Scott and Damien as they take the business forward and build on its long-standing reputation.”
Rhys Gedrych of SME Finance added:
“Design & Supply is a high-quality business with strong fundamentals, a loyal customer base and a proven ability to deliver consistent performance.
“The MBO team knows the business inside out and is well placed to drive the next phase of growth. We're delighted to support them in strengthening financial processes and helping to unlock further opportunities.”
The £40 million Wales Business Succession Fund is part-financed by the Clwyd Pension Fund. Loans and equity investments between £500,000 and £5 million are available for management teams seeking to own and run their own business. Terms range from one to seven years.
The £500 million Wales Flexible Investment Fund supports Welsh businesses with terms of up to 15 years. Loans, mezzanine finance, and equity investments are available from £25,000 to £10 million.
