Edmund Truell
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Edmund Truell

CEO, Duke Street Capital

Edmund Truell is a very private man. He almost throws me out of this office when I tell him I want to write a profile of him. "If you want to ask me whether I like fennel or not you can leave now," he growls. There goes my first question.

He does not look like a man who has just successfully emerged from a long quest to sell a company - though this is what he has done, having sold Duke Street Capital's stake in UK DIY products group Focus Wickes to Apax for around £120 million early last month. This was the end of an arduous process: from Duke Street's first investment in the company 15 years ago, through the SFO investigation into fraud at Wickes, which collapsed in November, through the failed IPO of Focus Wickes in July 2002.

It has been a slog but Truell still looks hungry for the next deal.

Truell started his career working for the innovative leveraged buy-out team at Bankers Trust in the early 1980s. He says: "Back then we weren't exactly welcomed with open arms by many companies. We were often seen as a last resort - which is very like the situation in Germany now. I remember we were in talks with the management of one company, and the CEO got a call from a friend while we were there, saying: 'Sorry to hear you've gone bust.' The CEO said: 'What do you mean? I've just done a deal for £100 million.' The friend replied: 'We assumed because you had the buy-out people in you must be about to go into receivership.'"

However, thanks to a few key deals in the UK, such as the Woolworths buy-out in 1982, the market gradually perceived that buy-out firms made a lot of money, did not necessarily mean the end of a company, and could actually help to grow strong competitive companies.

This has always been Truell's strategy, from when he was co-founder of Hambro European Ventures, Duke Street's predecessor, in 1988, to when he became CEO of the company and turned it into Duke Street Capital in 1994. As Bill Archer, CEO of Focus Wickes, says: "He's very competitive. He likes to create market leaders."

Truell does this by buying an acquisition cheap, putting in expert management from its sector, then working on that business, often with new technology or with new acquisitions, to make it a market leader.

For example, in 1998, Duke Street Capital bought BLMS, a pub coin-machine company, from Bass. It renamed it Leisure Link, and brought in Russell Hoyle, a veteran of the pub industry, as its CEO. Leisure Link then made some more tactical acquisitions - a couple of slot-machine companies, and equity investments in two IT companies. This enabled Leisure Link to run its network of around 90,000 slot machines from one main internet network, substantially reducing the costs. Leisure Link is now the world's largest pub slot-machine company.

Duke Street Capital is looking to expand its presence in continental Europe. Truell says: "The most interesting market outside the UK is France. It needed the first crop of proper deals to give the market confidence - it has that now. It also has a lot of heavily indebted conglomerates and banks looking to sell." Duke Street Capital is particularly interested in the drinks market, and has started making key acquisitions, such as Marie Brizard, a producer of liqueurs, in which Duke Street invested in 2000. This year, it bought French alcohol retailer LCB, making Marie Brizard the largest alcoholic drinks producer in France.

The German market, by contrast, has taken a definite turn for the worse. Truell says: "The re-elected government is acting in a very hostile way to our sort of operation."

Truell remains a vocal defender of the UK private-equity industry and a critic of government red tape, which seems to be the thing most likely to wind him up (after questions about fennel). He says: "The Labour government has accepted a lot of what the BVCA proposed - it has made significant improvements on the capital gains tax situation, for example. But there's still far too much unnecessary regulation of companies. Our annual regulatory costs, for example, are £1 million."

Truell has four children, the eldest of whom is 11. He already seems to be taking after his father. Truell says: "He wrote a letter to his grandmother the other day thanking her for £15 she'd given him. He said: 'My fund-raising mission is now complete.'"

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