Fund makes Yorkshire debut with £11m backing for firm

NorthEdge Capital invested £11m in Help-Link, valuing the home heating business at £30m.

The Leeds-based company specialises in boiler installation and maintenance and is rapidly growing in a fragmented national market.

Mel Butler, chief executive and co-founder, said Help-Link competes against British Gas and “white van man”.

This year he expects the company to double its turnover to £60m and create another 100 jobs, bringing the total workforce to 700.

“These are very exciting times,” he said, but added that businesses can encounter “certain dangers” during periods of fast growth.

The management team wanted to bring in people “who have already trodden the path” and help to expand the business properly, said Mr Butler.

The company has appointed retail veteran Keith Pacey to chair the business. Andy Ball and James Hall, both of NorthEdge, also join the board.

Help-Link has invested heavily in advertising to build its profile. TV presenter Johnny Ball fronts its campaign.

Mr Butler, a former central heating engineer from Wakefield, founded the business with Gary Howe in 1998.

In 2010, Help-Link launched its ‘Johnny Ball deal’ offering a new boiler with 10-year manufacturers’ warranty to compete against rivals offering only cover on old boilers.

Mr Butler said: “When we came up with that deal we said ‘we have changed the way central heating will be bought forever’.

“In Johnny Ball’s words, it’s a perfect deal for the truly dreadful times the country’s in because it saves you money to swap your boiler. That’s why it’s been extremely popular and will continue to be.”

He said the company is “absolutely customer-led” and offers cheaper finance rates than high street banks.

Help-Link is looking for new recruits, ranging from management to administration and engineering to support services, and expects to have 1,000 employees in the next three years, added Mr Butler, 43.

He said he thought about bringing in external investment over recent years. “NorthEdge managed to persuade me that it was the right thing for us to do,” he added.

“The timing was key. We are going into quite a large growth period.” As part of its marketing efforts, Help-Link has signed a three-year shirt sponsorship deal with Leeds United. “We started in Leeds. It’s a good wrap-around for us,” said Mr Butler, who moved the business into new offices at Thorpe Park earlier this year.

James Hall, a director at NorthEdge, told the Yorkshire Post that the boiler installation sector might not seem the most exciting “but there’s some magic to the business that you can’t put on paper”.

He said: “There is a real buzz around the place. It will continue to grow. It is going to create wealth in terms of more employment and more jobs through the supply chain.”

Mr Hall added that Help-Link has a lot of potential to grow into new locations beyond Yorkshire and the North West. “It has a national platform,” he said.

“It’s got a good market position and it’s good a strong brand through advertising.

“We did a lot of due diligence on its reputation and it’s fantastic in terms of customer experience.

“It’s offering something unique and affordable and it does it very quickly. Service is at the heart of the business.”

NorthEdge closed its first fund this month at £225m with backing from institutional investors in America, Europe and Australia in one of the largest fundraisings since the credit crunch.

The private equity house targets the mid-market with investment in businesses with an enterprise value of £10m to £100m.

Mr Hall said NorthEdge is seeing an increase in the quantity and quality of investment opportunities.

“We think the mergers and acquisitions market is certainly better than it was 12 months ago. We still think there’s a degree of cautiousness around, but we are seeing quite interesting opportunities.

“The striking thing is they are big growth stories. If you have a specific niche that’s doing things better than the competition, being innovative, looking for different solutions, treating the customer well and giving them a great experience, you tend to be doing well despite the wider doom and gloom.”

Looking to a bright future

BUYOUT firm NorthEdge Capital will provide Help-Link with funds for acquisitions if any suitable opportunities come up, said director James Hall.

Partner Andy Ball said: “Help-Link has grown significantly in recent years, thanks in part to its decision to enter the private installation market. This investment provides the backing to continue and accelerate that growth as the management team capitalises on opportunities and changes in the market.

“Help-Link is a Yorkshire success story that has succeeded by providing a great customer experience for an essential service. Its future is bright and we are delighted to be a part of it.”