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After four years of ownership, Palatine Private Equity has sold CTS Group (Construction Testing Solutions) to Oakley Capital Investments for an undisclosed sum.
At the same time, Oakley has acquired Phenna Group, a recent agglomeration of testing houses, and is folding CTS into Phenna.
Oakley said that the combined capabilities that the two businesses have in the UK across laboratory testing, site-based testing and surveying, and geotechnical consultancy presented a leading portfolio of services in the sector.
CTS was founded in Leicester in 2006 as CET Group. It was originally backed by private equity investor Dunedin. In 2016 CET bought Doncaster-based Construction Testing Solutions (CTS) and Chesterfield-based Omega Calibration Laboratories. CET Infrastructure then changed its name to Construction Testing Solutions (CTS) in January 2021.
Since being acquired in 2018 by Palatine Private Equity, CTS has doubled in size, acquiring Card Geotechnics (CGL), Nicholls Colton, Silkstone, Mason Evans and GT Certification. Today it has nearly 900 employees.
Under Oakley ownership, the existing CTS management team will continue to lead the business within the wider group.
CTS chief executive Phil Coles said: “Our time under Palatine ownership proved highly successful for CTS through both organic growth and acquisitions and the opportunity to continue that as part of a larger, successful and ambitious group as Phenna is fantastic news for the whole business.
“Oakley’s experience in supporting ambitious businesses in M&A activity and the opportunity to do this as part of Phenna, contributing to Paul and the team’s incredible success to date means an exciting future for all those involved in the business.”
Phenna Group was incorporated in 2019 by chief executive Paul Barry to buy and build companies within the testing, inspection, certification and compliance (TICC) sector. Phenna Group includes James Fisher Testing Services, Buildcheck, Stroma, PTS Pavement Testing Services, Celtest and JHAI Building Control.
Paul Barry had previously been global managing director and interim chief executive of Exova Group, a major player in the materials testing sector. Earlier in his career, he was a senior executive with Bureau Veritas and, before that, served as a managing director of Germanischer Lloyd (GL).
Paul Barry said: “We were attracted to Oakley’s deep expertise in M&A execution and integration, as well as their strong track record in helping businesses to internationalise at scale. As we look to the future, we’re excited to be working with them and together delivering on our mission to grow Phenna into a leading global TICC player.”
He added: “I’m delighted that Phil and the CTS team will be joining Phenna Group. I’ve known and respected CTS for a number of years and their experience and strong growth track record, fits perfectly with Phenna’s longer term ambitions.”
Paul Barry and Phenna finance director David Harrison retain a stake in the business alongside Oakley Capital.
Oakley Capital is registered in Bermuda, where companies do not pay income tax or capital gains tax. Founder and managing partner Peter Dubens said: “Phenna Group is exactly the kind of entrepreneurial disruptor that Oakley was founded to support. We are pleased to have been able to help them with the acquisition of CTS Group, one of the pre-eminent testing brands serving UK infrastructure customers. We believe Phenna has the potential to become one of the leading TICC groups in the world and look forward to supporting them to achieve that vision.”
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