Rae and McCabe sell Redeem to Bayley team

REDEEM, the recycling specialist employing 74 people in Falkirk, has been sold by its founders to a management buy-in team that aims to expand the firm's operations.

Jamie Rae and David McCabe have sold their respective 67 per cent and 33 per cent stakes in the business to a team led by private equity investor Trevor Bayley, best-known as one of the founding partners of HgCapital.

The new management includes former Vodafone director Curt Hopkins and Pete Petrondas, the Cheshire-based founder of Eazyfone and its online platform Envirofone.

Hopkins becomes chief executive of Redeem. Petrondas assumes the role of chief operating officer, while Bayley will become Redeem's first chairman.

The new directors intend to accelerate Redeem's growth by expanding into the recycling of products such as smartphones and tablets. Redeem, which currently specialises in handling mobile phones and ink cartridges, has doubled turnover during the past year to some 20 million and is currently on course for annual profits in the region of 1m.

Petrondas, who disposed of his stake in Eazyfone when he left the business in 2009, said the new management team would initially focus upon improving Redeem's testing and refurbishment processes, thereby increasing margins on sales of used mobiles. They are also keen to drive up volumes both through existing and new channels.

"Business development is a real short-to-medium term focus for us," he said. "We would not look at acquisitions for the first six to nine months."

Set up in 1999, Redeem began life as an offshoot of a printing business run by Rae. From a spare room in his home, he began recycling spent printer cartridges.

"I thought that there must be something we can do with them, rather than just throwing them all in the bin, and it has all grown from there," he said.

Redeem now works with more than 300 charities and retailers such as Boot's and Sainsbury's to offer customers mobile phone recycling schemes. It signed a deal with O2 network operator Telefonica 18 months ago and more recently sealed an agreement with Phones 4U, and is currently in talks with two other network operators about potential deals.