Navigational aids company sets course for growth after £7.5m funding deal

Pharos Marine Automatic Power – a leading global provider of marine aids to navigation – has undergone a recapitalisation backed by £7.5m debt funding from Frontier Development Capital (FDC), part of Mercia Asset Management PLC.

The deal provides an exit for a key US shareholder and enables the management team led by CEO Owen James to take a substantial equity stake in the business. It will also provide funding to support its future growth.

Pharos produces integrated navigational aids systems including beacons, fog signals, helideck lighting and aviation lights to mark offshore assets such as drilling rigs, production platforms, windfarms and bridges. Its solar-powered products not only ensure the safe navigation of vessels and aircraft, but also help clients to decarbonise their operating assets.

Pharos serves blue-chip clients in the oil and gas, alternative energy and ports and harbours sectors and provides a complete service from design and manufacture to installation and decommissioning. The company employs 67 staff in the UK at its plant in Great Yarmouth and head office in London. It also has assembly plant in Louisiana, and operations in Singapore and the UAE.

Pharos was founded in 1904 by Gustaf Dalen, a Swedish engineer who invented the ‘Dalen Flasher’, a lighthouse beacon that reduced gas consumption by over 90%, and who went on to win the Nobel Prize for Physics. Over the years the company has provided products for many iconic projects including the first oil rigs off Texas and the first buoys for the Panama Canal.

Toxaway Capital Partners, the US family office which acquired the full share capital of the business in 2009, will retain a majority stake as part of a generational transition.

Owen James, who joined the company 15 years ago, was appointed Group CEO in 2021. Since then he has reorganised the business and revamped production to speed up its recovery following the pandemic. As a result, Pharos has significantly improved efficiency and doubled its turnover in the past two years.

Owen James said: “Pharos was founded on the principle that ’the light must never go out’. More than a century later we continue to keep the lights on and provide power supplies for customers worldwide using renewable energy. This deal will provide a sound basis for the business to move forward and pursue our growth plans and we look forward to this exciting new chapter in its history.”

Justin Sorby of FDC added: “Pharos’s products play a vital role in ensuring the safety of shipping and aircraft worldwide and in energy production. The company is achieving strong growth and is well placed to benefit from transition towards renewable offshore power. We are pleased to be able to support Owen and the team as they continue to build the business.”

 Chris Roberts Associates provided corporate finance advice to the management team while Gateley provided legal advice to FDC.