OakNorth has provided a loan to GroWell Hydroponics & Plant Lighting Ltd (GroWell), a UK retailer of hydroponic equipment and consumables. Hydroponics is a method of growing plants without the use of soil, providing artificial lights and roots submerged in a nutrient-rich solution, which enables the cultivation of plants not dependent on local climate.
In the UK, 15 percent of cucumbers and tomatoes are grown hydroponically.
The funds will be used for working capital and a management buyout led by Tom Ward, the company’s managing director.
Founded in 1994, GroWell started out as a single garden centre based in Solihull. The company now operates eight separate stores across the UK, as well as two Warwick-based warehouses.
Its retail offering includes an extensive range of hydroponic equipment and related products, including nutrients, filtration systems, lighting and complete grow kits.
Tom Ward, Managing Director of GroWell, said: “I am excited by the future prospects for GroWell. The increased awareness on sustainability and the ability to grow exotic, insecticide-free plants 365 days a year in confined spaces is attracting more hobbyists into the sector.
“Despite being a relatively niche sector, OakNorth took the time to understand our business and the high-growth potential of the wider industry. They designed a finance package that will enable us to pursue the next stage of our growth and ensure we have the right team in place to achieve our long term strategic goals.”
Adam Agius, Director, Debt Finance at OakNorth, said: “Hydroponics is an incredibly interesting sector with high-growth potential for the future. Over the last 25 years, GroWell has established itself as the leading retail player in the UK, demonstrating resilience throughout the economic downturn and an ability to continue growing its market share year-on-year.
“We were impressed by the management team, the business’ strong long-standing relationships with suppliers, and continued focus on product innovation, so are excited to support them with this management buyout. We were also delighted to complete our first transaction with Springboard Corporate Finance in Birmingham who acted as advisors to GroWell.”
OakNorth was advised on the deal by Browne Jacobson LLP.