Catherine Durris - Businesswise Solutions


We sold last March. It’s a three-year earnout due to end in December 2023. When you’re in an earnout position,


they set you quite racy targets so we’re fully in it at the minute.


We were bought by one of our biggest competitors. We are an energy management consultancy based in Nelson and Inspired Plc, based in Kirkham, had been stepping around us for a few years and we were never interested.


I think what changed was that we’d been going 10 years and continually building, with good growth, 20 per cent every year.


The question was always, ‘what are we building for?’ It was for something, but we didn’t really know what. Was it to get money in to carry on growing? Was it a trade sale?


The opportunity came at the back end of 2020 when we’d just come out of lockdown. The deal that we were offered had a good chunk upfront, but with the ability to continue to grow the business and do exactly what we were doing, because we really believe in it. It was a good opportunity that we couldn’t refuse.


We’re in it as a minimum to 2023, but we’re enjoying it and who knows what might happen past then.


It has been really good, to be honest. Once the deal was done it was a bit of an anti-climax really. It was, ‘Right, let’s crack on’. They’re pretty much leaving us to it.


If you’re starting


to get bad vibes, trust your instincts. We pursued quite a big acquisition in the early days, and it went horribly wrong


One of the reasons why we chose to do the deal is because we wanted them to keep the staff. We wanted to keep the business going, we didn’t want to just walk away overnight and see the business swallowed up.


You want to do it for yourself, but you do have to think about everybody, because you’ve all grown the business. It becomes a family, and you want to make sure that everybody is looked after.


There are so many ways a deal or a de-risk can happen and it’s just keeping an open mind on what works for you at that point.


We’re still in it big time, I suppose in a couple of years’ time we might be thinking, ‘Why did we exit? We should have carried on, we’ve still got the energy, we’ve still got the hunger’.


But then I suppose you just have to divert that into something else that you enjoy.


Richard Slater Lancashire Business View (Chair)


Paul Dixon Rothband


Catherine Durris Businesswise Solutions


Richard Few Sales Geek


David Gorton PM+M


Darren Gowling University of Central Lancashire


Natalie Hughes Simply Corporate


THE PANEL


Amin Kamaluddin SK Growth


Jordan Kellett EFS Global


Paul Matthews WHN Solicitors


John Meadows Sagar Insurance (formerly)


Dave O’Keefe Luxus Design Anthony Smith


Bar Pintxos (formerly Lantei)


Paul Spencer PM+M


John Meadows - formerly Sagar Insurance


We sold in 2018. Prior to that, we’d done several acquisitions ourselves, but they’d all been very sector specific.


We’re general insurance brokers so we bought out other brokers and then we were getting to retirement age, we’re in our early 60s.


We received unsolicited approaches from several companies and decided we weren’t ready to sell, but we’d explore some of them.


We ended up liking the people that were going to buy us and they also made us a good offer. It wasn’t the highest offer, but we felt we could work with them in the future and it would be a good home for the business, which was very important to us.


The people aspect of the deal, the dynamics of all that is really important. You’ve got the owners, the acquirers, the staff and the clients.


After working in the business for so long, we felt that we wanted it to go to a good home, and that was one of the reasons that we selected the people that eventually bought us out.


The exit was to a specially set up company that was acquiring brokers. That’s all they did. They didn’t run them, they acquired brokers that were solid management wise. We were their 12th in 2018 and currently I think they’ve done 75.


They are just doing the deals to put the brokers together, and then they’re going onto the next deal, so the only companies that they will consider are ones that can then continue to run themselves after acquisition.


This equally applies if you’re a buyer or a seller. You get locked into the process and you invest a lot of time and money with the due diligence and the process overall.


If you’re starting to get bad vibes, trust your instincts. We pursued quite a big acquisition in the early days, and it went horribly wrong.


If we’d taken notice of what was coming across from the other side, more on the people side than the numbers, we would have backed out. You should have your wits about you right through to the end.


Jordan Kellett - EFS Global


EFS Global is a transport, haulage and freight forwarding business. It’s been established since 1996, but we really


went on an acquisition warpath from 2015.


We’ve completed 16 acquisitions since 2015, six of those were last year alone. Last year everything just fell into place.


A lot of people had got to the end of their tether with Covid, Brexit and, in our industry, driver shortages. A couple of those acquisitions probably wouldn’t have happened if Brexit, Covid, and all that hadn’t happened.


We are now sitting at a £100m turnover and we are very profitable off the back of that. We’ve consistently been at about ten per cent net profitability throughout the journey.


Former shareholders stick around for a long time on earnouts, typically for at least three years, and that’s because continuity is key for us, for the staff that are there and the customers.


We are only buying well run, profitable businesses. You want to retain the management; you want to retain every element that makes up that profit.


So, it is incredibly important to keep the continuity, the sort of family passion that comes with the size of businesses that we’re acquiring, because they do tend to be family orientated and maybe second or third generation businesses.


There’s an awful lot of passion in there and that all adds up to deliver a very healthy bottom line.


Continued on page 32 LANCASHIREBUSINESSVIEW.CO.UK


31


DOING THE DEAL


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