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dealmaking roundtable ... continued from previous page


Norman: “Our success rate from DD to completion is very high because we set the bar right in the first place.” Reputations are important and people have to live with what they have promised – in the days and years after, he added.


Anstey: “Our job is about creating a choice of offers and allowing clients to view them in context. We talk about maximising deal value, but it’s also about creating confidence for our clients that they are getting the best deal possible.


Thorburn mentioned sellers requesting an earn-out option to ensure a deal is deliverable, thus demonstrating their alignment with the deal and the business’s future.


Rolfe was unaware of that scenario but said “... that would be music to my ears” because it would confirm for the buyer that the business had genuine potential in the eyes of the seller.


Anstey said BCMS believed the motive of potential buyers had a big impact on valuations, and so it concentrated hard on building a wide range of influential buyers. “For every successful sale, we have an average of seven meetings with interested buyers, and we always seek to get multiple offers. Conventional pricing doesn’t come into it in such a scenario. It’s about the future story of what the buyer can do with the business and how well it answers their motive to buy.”


Hunt pointed out that the agricultural seller he mentioned did not take the highest offer. “An entrepreneurial seller often cares more about the company name, its staff and their future than getting money in his own back- pocket.”


Arnold exampled a seller who accepted an MBO option rather than a more valuable trade sale offer, for exactly that reason.


Charles Thorburn


“Though we represent vendors, we do a lot of thinking about de-risking the transaction for the buyer, and have just begun commercial, financial and legal pre-DD for clients to make sure we are all aware of the potential deal pitfalls. We don’t want things to be discovered that could have been managed prior to DD, then see a deal fall over.”


New trends in dealmaking


Arnold mentioned that, with UK economic growth picking up, sellers were now asking for earn-outs, and staying with their businesses as a lesser shareholder for a period to gain a return from its future growth.


news extra Another significant acquisition for property group Romans


The Romans Group has announced another significant step in its continued expansion – its fourth company acquisition this year. It has acquired Campsie’s residential and commercial sales and lettings branches in Staines-upon- Thames, West Drayton and Windsor.


Campsie has been established for over 40 years and joined the Orchard & Shipman Group in 2005, a reputable and successful national property services group which will continue to trade following the acquisition of Campsie, specifically focusing on private-sector leasing.


Shane Spiers, chief executive of the Orchard & Shipman Group, commented on the transition: “When the time came to sell it was vital we


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found a company with the same core values and high standards our customers and team have become accustomed to receiving.


“The Romans Group ticked all the boxes for us, and we’re delighted with how straightforward, professional and understanding their approach has been to the entire acquisition. On top of that, as an established agency with similar services available to their customers, including mortgage advice, surveying, and conveyancing, we knew our landlords, tenants and vendors would be well looked after and in fact benefit from the extra resources a larger company can provide.


“Our employees are central to our success and we


strongly believe that joining the Romans Group will not only benefit our customers, but also the staff and their progression.”


From October 5, Campsie Windsor will be fully- incorporated into the Romans Windsor branch, while the Staines-upon-Thames and West Drayton offices – which will remain in the same locations – will undergo complete transformations to bring them in line with the modern offices seen across the Romans Group.


Expanding its territory coverage has been high on the agenda for the Romans Group with a number of successful acquisitions already under its belt since 2013, and a £12 million finance facility from its bankers available for more business purchases.


THE BUSINESS MAGAZINE – THAMES VALLEY – OCTOBER 2015


Rolfe: “That’s because he wants to feel able to walk down the streets where a lot of his former employees work. That’s a value he puts on the deal.”


Why do deals go wrong?


Acquisitions can fail explained Arnold if buyers do not truly understand the business they are buying – perhaps through poor due diligence or misguidance by the sellers. Or deals can go wrong because a key contract of the acquired company is lost soon after purchase.


Roberts agreed there could be several reasons why deals fell down. “We always try to get to the potential deal-breaking aspects straight away, before a lot of work will have been put


David Murray


Hunt: “At BCMS, a skilled team of qualified financial analysts assist clients to prepare realistic and credible business plans.”


Arnold stressed the need for proper early preparation rather than business owners essentially ‘daydreaming’ into a sale and exit, having done no research of requirements, gained no advice or skilled assistance to help maximise the deal and get the sale away.


Banker Roberts said early engagement with potential lenders was very important, in order to ensure key risk areas of business plans were adequately covered. This could save much time and questioning when it came to later financial DD.


Rolfe suggested proven experience was key. “As a private business owner you might make one acquisition in your lifetime.” Professional dealmakers know how to make acquisitions, have the skills, contacts, and processes in readiness to progress things successfully. “Because we buy many businesses every year, we bring a rigour to the process that gets things done, while business owners often simply see the attractive figures and glamour of the activity.”


in by all concerned, and we try to mitigate those risks of the transaction falling apart.”


"Are business plans crafted well enough by the deal participants?" asked Murray.


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