Lloyds Development Capital (LDC), the mid-market private equity arm of Lloyds TSB, has agreed terms for the acquisition of the Stirling Group, which makes lingerie for Marks and Spencer, in its first public-to-private transaction.

LDC's offer of 22p a share, valuing the existing share capital of Stirling at £18.7m (€26.94m), assumes an additional £13m of debt as well as £30m of working capital from Royal Bank of Scotland and a consortium of four Hong Kong-based banks.