Pierce Corporate Finance advise on buy-out of electrical wholesaler

A team of North West advisers acted on the seven-figure management buy-out of an electrical wholesaler.

AA Jones Electric of Hull, founded in 2009, is now one of the region’s leading independents.

The buy-out gives control of the business to co-founder Andy Moulds, the sales director, and long-standing employee Sam Lomax, who becomes managing director.

It will allow for the retirement of one of the founders, Ian Wayman. The third founder, Tony Moore, will retain a stake in the business and continue in his role as finance director.

Pierce Business Advisory and Accountancy Group of Blackburn provided corporate finance and tax advice to the company, while WHN Solicitors of Bury provided legal advice. The deal was backed by funding from Mercia Debt.

AA Jones employs 20 staff at its premises on Hull’s Venture Business Park and serves both the public and trade buyers. It supplies electrical equipment for domestic and commercial use, as well as industrial automation and controls. 

The company acquired an adjoining distributor, Seltec Automation, in 2022 which is now fully integrated.

It currently stocks over 12,000 product lines and offers specialist advice on factory automation or for projects required to meet building or health and safety standards.

Having recently introduced new lines such as solar lighting, EV chargers and smart building technology, it plans further to extend its range of renewables and industrial cables.

AA Jones has secured a £1m funding package, with half coming from Mercia’s SME Loans fund to support the buy-out. NPIF II – Mercia Debt Finance, which Mercia manages as part of the Northern Powerhouse Investment Fund II (NPIF II), also provided £500k to support the growth of the business following the management buyout.

It will provide additional working capital to enable the company to increase stock levels and create around five new jobs in the next two years.

Paul Bennett of Pierce said: “It was a pleasure to work with the team at AA Jones to structure a transaction that allows the management team to take the business forward and look forward to seeing the business continue to grow over the coming years.”

Sam Lomax, managing director, said: “Tony and Ian have built a very successful business with a dedicated and experienced team. Having joined the company 13 years ago, I am very grateful for all the support and opportunities they have given me.

"I am proud to be taking on the role of managing director and look forward to working with Andy and the team as we continue to grow the business.”

Rebecca Pickering of Mercia Debt, said: “AA Jones is well respected in the industry. It sets itself apart from the big chains by its customer service and knowledgeable staff and despite tough competition, has continued to grow revenues. We are pleased to have been able to support the buy-out and provide funding for its future growth plans.”

Lizzy Upton, senior manager at the British Business Bank, said: “The future of the electrical industry is bright, with the likes of solar lighting and EV growing in popularity amongst consumers. It is great to see Yorkshire & Humber businesses like AA Jones Electrical making use of NPIF II funding to capitalise on this, supporting its future growth and supporting the Northern economy.”

The purpose of the Northern Powerhouse Investment Fund II is to drive sustainable economic growth by supporting innovation and creating local opportunities for new and growing businesses across the North of England. The Northern Powerhouse Investment Fund II will increase the supply and diversity of early-stage finance for the North’s smaller businesses, providing funds to firms that might otherwise not receive investment and helping to break down barriers in access to finance.