Duncan & Todd eyes expansion after BGF backing

Frances Duncan is looking to expand Duncan & Todds branch network. Picture: Contributed

One of Scotland’s largest chain of opticians is on the look-out for acquisitions after securing a £5.6 million investment that has brought in a high-profile chairman.

Duncan & Todd, which has a 23-strong retail estate focused around the North-east, said the backing from the Business Growth Fund (BGF) would also help it expand its in-house manufacturing division, Caledonian Optical.

Managing director Frances Duncan, who led a management buyout backed by Royal Bank of Scotland in 2007, told The Scotsman that the Aberdeen-based firm would be seeking to buy individual practices or smaller chains with a view to potentially doubling its branches within five years. She added: “We’d be looking for opportunities in Perthshire and Tayside, because we have staff and management in those areas and we know the market. We love market towns – I often say that if we’re between the butcher and the baker then it’s the perfect site for us.”

BGF has taken a minority stake in the business as part of its investment, which has also seen mergers and acquisitions specialist Bob Brannan become the optician’s chairman.

Brannan, who has previously been chief executive of Rangers, managing director of distiller Whyte & Mackay and chairman of fashion label Ben Sherman, also chairs Fife-based pet care firm Vets Now and serves on the board of William Jackson Food Group, owner of Yorkshire pudding maker Aunt Bessie’s.

Patrick Graham, senior investment manager at the BGF, has also joined Duncan & Todd’s board. He said: “BGF’s support will now allow Duncan & Todd to widen its horizons and discussions are already under way to acquire a number of additional retail units.”

Glasgow-based rival Black & Lizars, which has 27 branches, last year said it was seeking to almost double the size of its estate within two years by buying up individual practices across Scotland.

Chief executive Mark Ross said the firm, which traces its roots back to 1830, had also been approached by some businesses south of the Border.

Duncan & Todd, formed in 1973, generates a turnover of more than £10m, while the total market for UK ophthalmic goods and services was worth about £3.5 billion last year and could be worth £4bn by 2017.

Duncan said: “You’re up against it when it comes to the multiples, but we’ve focused on good service and good products.

“Our staff have a lot of autonomy to buy their own products, after all what sells in Peterhead can be quite different from Fraserburgh.”

Yesterday’s deal with Duncan & Todd is the eight investment in Scotland for the £2.5bn BGF, which was launched last year by banking groups Barclays, HSBC, Lloyds, Royal Bank of Scotland and Standard Chartered.

The fund injects between £2m and £10m into companies with a turnover between £5m and £100m in return for a minority equity stake and a seat on the board. It recently provided £2.8m for candle and soap maker Arran Aromatics, while its largest Scottish deal came in September, when it invested £10m in Aberdeen technology company Inoapps.