contact us on +44 (0)20 7318 5700 mergers & acquisitions 19


H.I.G. Europe is the European arm of H.I.G. Capital, a leading global private equity investment firm. We specialise in providing capital (typically from £5m up to £75m) to small and medium-sized companies with attractive growth potential. We also have extensive experience with financial restructurings and operational turnarounds.


For further information please visit www.higeurope.comor contact us on +44 (0)20 7318 5700


H.I.G. Europe is the European arm of H.I.G. Capital, a leading global private equity investment firm. We specialise in providing capital (typically from £5m up to £75m) to small and medium-sized companies with attractive growth potential. We also have extensive experience with financial restructurings and operational turnarounds.


For further information please visit www.higeurope.com or contact us on +44 (0)20 7318 5700 Financing moves ’back to the future’


’It feels like the late ’80s and early ’90s, when deals were done properly and for the right business reasons,’ says Steve Brown, head of private equity (PE) for RSM Tenon’s corporate finance team, talking to John Burbedge


Corporate financing has taken a fundamental step backwards to the old textbook rules of funding – “Is this business proposal a bank or equity risk?“; “Is this business worthy of support?“; “Can it prove its past performance?“; “Has it the right management team?“; “Can it repay the loan?“ .... etc.


“We are back to behaving in an intellectually correct commercial manner, but businesses also need to be well advised by experienced professionals when seeking funding. There is a lot more skepticism around nowadays about business propositions, forecasts and figures,“ says Brown.


Finance for growth is still suffering from the new regulatory demands on banks to ensure their solvency. “Funding below £8 million is quite difficult, and above £40m gets a bit tricky too.“ In banks as well as businesses, decision-making minds are still short of commercial confidence.


Brown believes that far more businesses will need to adopt a


’Dragon’s Den’ mentality and pitch for equity money to support their commercial futures.


Furthermore, funding pitches, whether to banks or equity, will need to be rigorously constructed. “Banks have been getting some bad press recently for saying ’No’ to businesses, but often the funding proposition is not being ’sold’ to the bank properly.“


We may be moving backwards in our style of funding and dealmaking but Brown is relatively upbeat about future activity, whether during economic growth or cooling.


“Businesses in the main are doing ok. Some are within touching distance of pre-recession profitability levels. I know this is a thriving region, and this will vary across the UK, but I believe the economy generally is doing better than most people think.“


Brown admits that as a corporate finance adviser he deals with a skewed population of clients, often strong, looking for growth, M&A activity, or ripe for sale. “But, across


The buyers are mainly cash-rich PE-houses or corporates with strong strategic needs. Cross-border international deals, particularly US – Europe, are to some extent, still suffering from the macro-risks of Eurozone and national debt implications.


Brown highlighted two ’hot sectors’:


• IT managed services – software as a service (SaaS) and increasingly ’one-stop shop’ IT solutions providers


Steve Brown


the board within our firm, business activity is surprisingly strong and we are now dealing with a quality and size of businesses that we weren’t 15 months ago.“


So, is the anticipated 2011 year of M&A activity set to take off?


“More people are prepared to talk about doing something now. The sellers are back, and buyers are out there. Supply is steadily coming back into the M&A market but the deals are still quite strategic and seeking fair value or quality.


“Valuations are attractive at the moment. You could argue that if you don’t move now, then deals will cost you more.“


Sovereign Capital invests in Greenwich School of Management


Moore Blatch has successfully advised on Sovereign Capital’s recent investment in Greenwich School of Management (GSoM), a private-sector provider of university-accredited masters and doctoral programmes in business, law and management.


Based in Greenwich, GSoM was established in 1973 and today has more than 1,500 students. It has strong partnerships with the


University of Plymouth and the University of Wales and has been an accredited degree provider since 1991. It also offers a selection of travel and tourism courses in professional diplomas. Dr William Hunt, principal, will continue with GSoM and will be joined by Paul Brett as group chairman and Alex Sheffield as finance director.


Additional finance for the transaction was provided by


THE BUSINESS MAGAZINE – SOLENT & SOUTH CENTRAL – SEPTEMBER 2011


Lloyds Bank Corporate Market Acquisition Finance, and Sovereign has committed further funding to develop GSoM.


“The increasing demand for higher education in the UK, coupled with the financial constraints placed on public sector providers, offers an exciting opportunity for the independent sector,“ said Hunt. “There has never been a better time to expand operations. With


Sovereign’s investment and support, the college will be well placed to become one of the UK’s largest independent providers of university management education.“


The Moore Blatch team of six, led by Roger Bailey, advised the existing GSoM shareholders. Sovereign Capital was advised by the London office of Jones Day.


Bailey commented: “It is satisfying that we are able to continue attracting such high-calibre work to Southampton.“


www.businessmag.co.uk


• Healthcare – particularly domiciliary and specialist care (eg dementia).


For example, PE-backed Acromas, the owner of Saga and the AA, bought Nestor Healthcare in January (£124m). It has just purchased Allied Healthcare for £107m which specialises in providing care to patients in their homes.


Details for RSM Tenon Offices


Southampton: 023-8064-6464 Basingstoke: 01256-312312 Bournemouth: 01202-204780 Portsmouth: 023-9265-8331


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48