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27 February 2012

New investment for Castlerock Recruitment Group

Press Release 27th February 2012

The North West Fund for Development Capital (NWFDC), managed byYFM Equity Partners, has made a significant investment of development capital into Castlerock Recruitment Group Limited, a £15m turnover healthcare recruitment business that provides permanent and temporary staff to clients that include the Ministry of Defence (MOD), NHS, HM Prisons and Private Sector.

Castlerock is run by its management team of Ian Munro, Ian McDougall and Paul Booth and is headquartered in St Helens. It has ten offices around the country and employs 57 staff, including 31 recruitment specialists. This substantial investment from The North West Fund for Development Capital will enable Castlerock to expand its business by employing additional staff to support recent contract wins, as well as providing additional funds for working capital purposes.

As well as contracts with the MOD, the NHS, HM Prisons and the Private Sector, Castlerock has recently won contracts with the General Healthcare Group, to provide general ward nurses, theatre staff and healthcare assistants for this national private hospital group. Locally it has the contract to provide domiciliary carers for Liverpool District Council, Wirral Borough Council and Children's Services contracts to St Helens and Warrington Councils.

The North West Fund for Development Capital is a sub-fund of the £185m North West Fund that is financed by the European Regional Development Fund (ERDF) and the European Investment Bank (EIB).

Joseph Bergin, head of the North-West team at YFM Equity Partners and Matthew Male, Investment Manager worked on the deal. 

Commenting, Joseph Bergin said: "The Castlerock management team have delivered strong growth in their business over the last couple of years by winning new customers and expanding their offering into new segments of the healthcare market. We have been particularly impressed by the high regard with which they are viewed by their customers."

Ian Munro, CEO of Castlerock commented: "This  cash injection will enable us to grow our business, take on new staff and offer a larger number of top notch health professionals to under-resourced hospitals, clinics, care homes and other institutions that rely on experienced healthcare professionals to deliver the best quality healthcare every day."

Joseph Bergin added: "The investment into Castlerock is the third investment from the North West Development Capital Fund but the first investment of our new MEZZ product. Since launching in December there has been significant interest in the new MEZZ product as it fills a gap between conventional bank funding (which is difficult to obtain in the current market) and traditional private equity funding. The simplicity of the MEZZ product and the fact that the repayments can be made over a period of up to 7 years has been very appealing to businesses looking for a long term source of funding without the need to give up a large shareholding."

Andy Leach, CEO, of North West Business Finance said:   

"I'm delighted that The North West Fund has been able to support Castlerock's exciting growth plans.  Hopefully, the development of the MEZZ product will facilitate the faster deployment of our capital into many more ambitious North West businesses like Castlerock."

YFM equity Partners, through The North West Fund for Development Capital, invests between £100k and £2m in businesses across all stages of development.  Contact the team on 0161 832 7603 for further information.

YFM Equity Partners were advised on financial due diligence by PKF and Gunnercooke provided legal advice. Castlerock were advised on corporate finance by RSM Tenon and legal advice by JMW.

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