“A big positive was having a good reporting system, good governance and a good team around us which made due diligence easier.”
Announcing the deal Mark Redman, managing partner at Stellex, said: “We see strong potential in the company’s capabilities and resources and look forward to working together with management and our operators to seek to deliver on our value creation plan.
“This acquisition aligns with our strategy to identify companies where we believe we can introduce operational expertise in an effort to drive growth and better leverage companies’ assets and resources.”
Paul, who was brought up in Thornton, took over the reins of the business in 2007 at the age of 23 following the death of his grandfather.
Speaking to Lancashire Business View last year he said: “There was never any way I was going to do anything else but come into the business, nor did I want to. I spent half my school life in the yard.
“You learn as you go along and it was a very steep learning curve. I was raised by my grandad affectionately known as ‘Barney’, who always had the motto ‘look after the business
Expert View
FACTOR IN IP WHEN LOOKING AT DUE DILIGENCE By Daniel Fletcher, senior associate Forbes
Intellectual property (IP) is a broad term referring to creations of the mind. It is possible to register IP, such as a trade mark or a patent. However, some IP rights arise on creation, such as copyright in literary and artistic works.
IP assets are commonly bought, sold and licensed, sometimes for significant sums. As companies engage in mergers, acquisitions and investments, IP due diligence is a key element.
It typically includes the acquiring or investing party carrying out investigations in these areas:
Identification: The first step involves a comprehensive inventory of all IP assets associated with the business, including details of trade marks, copyright, designs, patents, trade secrets and any other proprietary information.
Ownership: This involves reviewing IP databases, but also any licences and assignments that the business has in place with its suppliers and customers. If a business has had a valuable piece of technology developed by a supplier, have copyright and neighbouring rights in that technology been assigned by the supplier? If it hasn’t, technically it isn’t owned by the business.
Scope: IP rights are territorial. If the business trades internationally, has it protected its IP rights or, more broadly, carried out freedom-to-operate searches in each jurisdiction? Exclusivity is only afforded over goods and services a trade mark is registered for. What if the business has expanded since its application? If further applications have not been submitted, there will be a gap in protection.
Infringement and litigation risk: This involves investigations as to whether the business is, has, or is likely to be involved in an IP dispute. These can be notoriously expensive and time-consuming. The last thing an acquiror or investor wants is to become involved in a business that is the defendant in infringement proceedings.
Once IP due diligence has been carried out, the acquiring or investing party will have a good picture of the risks and opportunities.
If the conclusion is the business is worth acquiring or investing in, a subsequent agreement will need to be put in place between the parties. This will often include a raft of contractual assurances relating to the state of the IP, based on the due diligence.
LANCASHIREBUSINES SV
IEW.CO.UK
and the business will look after you’.
“It’s not work when you enjoy it and I enjoy the fact we’re creating and building the company with the same ethos Barney installed in me and proud that we have a large number of colleagues within the family business, with an exciting future ahead of us.
“I’ve just travelled from Preston to Blackpool and have seen the family name on 15 trucks and that gives you a real sense of pride. The business is over 90 years old and we want it to be here for another 90.”
Doing the deal Page 59
Hassan Ahsan Assistant director at AMS Corporate Finance
MAXIMISING VALUE FOR SHAREHOLDERS
IN COMPANY SALES Maximising shareholder value in a company sale is dependent on multiple factors but key considerations include strategic fit with buyers, strong financials, favourable market conditions and a competitive bidding atmosphere.
Strategic Fit. Buyers that see strategic benefits in the acquisition such as market entry, enhanced capabilities or strong synergies are typically willing to pay a premium. Shareholders benefit when buyers recognise the acquisition’s potential to create added value beyond financials, leading to higher bids.
Financial Performance. A track record of revenue growth, profitability and cash generation, and future growth prospects demonstrate a well-managed company, enhancing appeal and attracting higher offers. Accurate, transparent financial data strengthens buyer confidence and often elevates value.
Market Conditions. Favourable market trends such as high growth in the sector or low-interest rates can drive competitive bids. Selling during optimal market conditions can significantly impact value, as buyer demand fluctuates based on economic cycles and industry shifts.
Competitive Bidding. Having a structured sale process involving multiple interested buyers fosters competitive tension that drives up the price and advisors play a key role in attracting a strong buyer pool, making the company more sought-after and raising bids.
In summary, shareholder value is driven by aligning strategic benefits for buyers, demonstrating financial stability, timing the sale to favourable market conditions and fostering competitive bidding. Bringing these elements together will maximise shareholder returns.
For further information call Hassan Ahsan 07854 829732
hassan.ahsan@groupams.co.uk www.groupams.co.uk
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DEALMAKERS
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