Jon Moulton, Founder of Better Capital, speaks to Helen Winsor of Finance IQ about distressed debt and offers his best practice tips on tackling the market.
Finance IQ: Jon, welcome to the show. Thanks for joining us. Now, firstly, Jon, can you give a little background on yourself and the founding of Better Capital?
J Moulton: Yes, I’m quite an elderly, private equity man. I’ve been around for thereabouts 30 years and greatly enjoy it. My previous firm was a mid-market private equity firm that really didn’t want to focus on turnaround, so I left them and set up Better Capital Limited (LON:BCAP) last autumn. We did it in a rather unique way. We set it up on the public markets. We’re now on the main market of the London stock market. We raised £210m with a view to invest solely in turnarounds of UK and Irish companies, hoping to basically make some money out of the grief driven by the recession.
Finance IQ: Thank you, Jon. Now, out of all the organisations that you’ve been a part of, which experience did you find the most rewarding? And also, which deals stand out in your mind as just incredible successes?
J Moulton: This is a really difficult question, because I’ve been around for an awful lot of different deals with different characteristics. In terms of making money, probably the best deal I ever did was one at £243 million, which was a deal with AG Stanley, a retailer we bought out of. But in terms of deep satisfaction, probably Parker Pen is a deal that really stands out in my background. Parker Pen was a business in Janesville, Wisconsin, though it was known all over the world. Most people thought it was a British company. It was run terribly, losing £20m a year, or thereabouts. It had all kinds of liabilities, nonsense, massive overheads.
We did something amazing: we bought the company quite cheaply, closed the head office in the United States and put one of the subsidiaries, which was the English subsidiary, in charge of the world. It had a delightful chief executive, Jacques Margry. And over the course of the next seven years, with management working with us in a productive way, that was really rather nice to do. We took that to making £40m-odd of…
