Gresham gets Hotter

Gresham, a UK mid-market private equity firm, has invested £21m (€27.6m) in Hotter Shoes, a footwear brand for the grey market.

HSBC provided debt and Ernst & Young, Cobbetts, KPMG and DLA Piper advised on the transaction.

Gresham’s investment will provide financing for the development of Hotter’s direct marketing strategy and the expansion of its product range.

Established in 1959, Hotter sells its footwear through mail order catalogues and has four retail outlets across the UK. According to the firm, the grey market is set to grow due to an ageing population and rising foot health problems associated with obesity, diabetes and arthritis.

Andy Marsh, the partner at Gresham who led the deal, said: “It is a niche brand focused on the affluent grey market, where we can see exciting growth potential. Also, the business has real scalability through its direct marketing channels via mail order catalogues and internet.”

The UK mid-market firm followed up this investment in Hotter Shoes with the sale of its nine-year investment in building contractor Warings to French group Bouygues Construction.

No sale price was disclosed but Gresham announced that it had made a four times return on its original investment in Warings in January 1998.

Based in Portsmouth, Warings has 240 employees and annual turnover of more than £100m. The company undertakes new build and refurbishment projects across the south of England, from residential, healthcare and commercial buildings to industrial, airports and defence establishments.