Addison Lee Group have confirmed that it will be entering into new long-term funding arrangements with a consortium of investors, led by Cheyne Capital and Liam Griffin, to support the future of its UK business.
At the same time, the Addison Lee US business has been acquired by RMA Worldwide Chauffeured Transportation. The terms of this transaction are undisclosed.
Under the new arrangements, Addison Lee’s overall debt will be more than halved, and substantial new capital made available to the business. The private hire firm hope this will provide the business with additional funding and an appropriate capital structure to enable further growth, investment and support cash generation.
On completion of the transaction, Addison Lee’s UK business will be sold by The Carlyle Group to a consortium of investors. At that time, Cheyne will become the Group’s largest shareholder and Liam Griffin, currently a non-executive director and shareholder, will return as CEO, replacing Andy Boland, who has led the business for the last four and a half years. Completion of the transaction will take place in March 2020, following the receipt of customary approvals.
Under Carlyle’s ownership, and during a period of unprecedented and significant market change owing much to ride-hailing firms like Uber, revenue has increased from £225million in the year ended August 2013 (FY13) to circa £390million in FY19.
Despite the growth in revenue, Addison Lee reported losses of £39million in 2019. That came after losses of £20.8million the year before, as they desperately attempted to compete with ride-sharing companies entering the market.
Andy Boland, Chief Executive, Addison Lee Group said: “This is a great moment for the future of Addison Lee with agreement on a new capital structure for the UK to support growth, and a new US owner to help take the American business to the next stage.
"Thanks to our partnership with Carlyle and their investment in the business, Addison Lee has a strong operations and technology platform supporting an unrivalled franchise with business customers in the UK – all underpinned by our first-class workforce and fleet of driver partners.”
Liam Griffin, prospective Chief Executive, said: “Whilst new entrants and technology may have changed over my 25 years with the business, what our passengers want remains the same. They are still drawn to Addison Lee’s values of quality, trust and, of course, choice.
“We were the world’s first company to develop a taxi app and we’ve continued to invest in our technology ensuring the Addison Lee experience is even more accessible and flexible to its customers. I couldn’t be more excited to be helping write the next chapter in our history.”