Phoenix Equity acquires controlling stake in Capital Economics

Phoenix Equity Partners has acquired a controlling stake in independent macro‐economic research company Capital Economics, alongside its existing management team and shareholders.

Phoenix's investment, which values Capital Economics at roughly £95m, will allow the group to accelerate its growth and enable investments in new services and technology to enhance and personalise client delivery with a number of potential acquisitions already being identified.

Telegraph columnist and one of the City's best known economists, Roger Bootle will retain "a significant stake" in Capital Economics, with its offices in London, New York, Toronto, Singapore and Sydney.

Capital Economics' existing backer LDC, Lloyds Banking Group's private equity arm, will exit its minority stake despite the business growing revenues by 30% to over £22.5m since its investment in October 2014.

In its latest financial year, Capital launched several new services, opened new offices in New York and Sydney and expanded its team by 30% to over 140 employees across its five locations.

Phoenix will work closely with chief executive Bob Dowson and the Capital Economics team to achieve its growth plan and Roger Bootle will remain as the group's chairman, continuing the same part-time role in the business he had held previously.

Chief economist Jonathan Loynes will step down later in the year after 18 years to be replaced by Neil Shearing, Capital Economics' highly regarded emerging markets chief economist.

Chris Neale, partner at Phoenix, said, "Capital Economics is an exceptional business with outstanding economists and staff, and an unrivalled reputation for macro‐economic insight. It has grown every year since inception, building up a global base of loyal repeat clients."

"Demand for high quality, independent research continues to increase and we are excited about the future potential of the business. We look forward to working with Bob and the team to help accelerate growth over the coming years," he added.

Bob Dowson, chief executive of Capital Economics, said, "As our output continues to grow, we want to use technology to help clients to personalise and tailor the insight they receive from us to enhance its value. Phoenix's investment will allow us to seize these opportunities."