Hundreds of jobs saved as Denby is sold in £30m MBO

Denby Pottery, the 200-year-old manufacturer of premium tableware, has been sold to a management buy-out team in a £30m deal that will save hundreds of jobs.

Garry Biggs, Denby's managing director, is leading the MBO of its UK and US businesses that was funded by Valco, the private equity arm of Hilco, the restructuring specialist.

Denby said that more than half of the group's £72m debt will be written off as part of the transaction, and that Valco has provided a working capital facility to the business. The manufacturer has struggled to service its hefty debts recently and is battling tough retail conditions.

Mr Biggs said: "With Denby's financial position now secure, we are looking to make a number of quality strategic acquisitions in the sector."

The UK pottery industry is facing a crisis after the collapse into administration of its rivals Waterford Wedgwood last month and Royal Worcester in November.

The pottery firm, which is named after the village of Denby in Derbyshire, employs about 700 people at its offices, factory and shops in the UK. Of these, about 500 are employed at its head office, factory and visitor centre in Denby, where the company was established in 1809. It has 16 outlet shops, Denby Factory Shops, in the UK. This month, Denby made 35 staff redundant, but it is unclear if there will be further job losses.

Mr Biggs said: "Given the gloom in the UK pottery industry which has been made worse by the failure to date of Waterford Wedgwood and Royal Worcester Spode to find a buyer to take them out of administration, we are delighted to have been able to secure funding for our MBO which we hope will help safeguard the future of Denby."

Hilco, which is well known for its work with distressed retailers, such as Woolworths last year, is understood to be a long-term investor in Denby.

The restructuring firm is also interested in acquiring other ailing pottery companies, including Waterford Wedgwood and Royal Worcester. However, KPS Capital Partners, a US private equity fund, is the frontrunner to acquire Waterford Wedgwood and a deal could be unveiled within days. Hilco declined to comment.