EY deliver as financial advisor on £80m QTS deal

EY’s transaction advisory services (TAS) team in Scotland has acted as exclusive M&A advisor to the shareholders of QTS Group Limited, a specialist independent rail contractor which is to be sold in an £80 million deal after it was established by managing director Alan McLeish in 1991 using a £300 loan from his mum.

Engineering services group Renew Holdings plc will acquire the Lanarkshire business which employs around 300 people and made £9 million profit on sales of £72 million in its latest financial year.

As well as advising on the sale of the business, EY’s deal team, led by Andrew Kerr and Ally Scott, and supported by Richard Rainey, also provided vendor-initiated financial and tax due diligence services.

Ally Scott, EY’s head of TAS in Scotland, said: “QTS has been a major success story amongst growth companies in Scotland in recent years and I’m delighted EY’s transactions team was chosen by Alan McLeish, Managing Director of QTS, to originate and deliver such an important deal for him and his fellow shareholders.

“This is the latest in a series of successful completions for EY as we step up our activity in dealmaking.”

Alan McLeish, managing director of QTS, said: “QTS is delighted to be joining the Renew Group and we very much look forward to the future as part of a larger group. The transaction will provide opportunities to expand our market share and benefit from the synergies with their existing successful brands working in highly regulated sectors. It was important to attract an owner with relevant expertise to support our growth ambitions without compromise to customer service or staff loyalty, the Renew business model fits perfectly with these aspirations.”

Paul Scott, CEO of Renew, added: “We are delighted to welcome the management and staff of QTS to the Renew group. This is a very complementary and earnings enhancing acquisition that aligns with our established and proven strategy, strengthening our position in the UK infrastructure market. QTS has grown to become a leading and well respected brand in the Rail sector and we very much look forward to supporting its ambition for continued growth including opportunities via collaboration across our expanded range of services in this sector.”