Given our extensive experience we specialise in the following types of business: Printing, Packaging, Marketing, Engineering and Allied sector businesses.
“Allied sector” businesses include those in the following areas:
Timing, of course, is vital.
An objective overview should be taken of your business, the industry sector and the overall economic picture, to assess if and when it is a good time to sell. Some circumstances make it easier to sell a business regardless of timing – for example, if you operate in a niche market with good contacts or have an excellent customer base.
Almost without exception, a good quality business should sell. Richmond Capital Partners can undertake such a review for you, and if we think the timing is wrong, then we’ll tell you. We have built our reputation on providing realistic, quality advice and not on chasing goals for short-term gain.
There is only one way to accurately value a business – sell it! All other methods hold a degree of subjectivity, not least because they involve taking a view of the future and logically, not everyone shares the same view.
However, to assess the value of your business, you need to consider a number of factors: track record, future potential profit trends, competitors’ actions, net assets, plant and property values.
Additionally, the most recent deals in the same sector give a useful indication of the price the potential buyers might pay. This information will be provided by a dedicated Valuations team.
Finally a strategic purchaser will always pay more for your business. We are very good at finding strategic purchasers.
Richmond Capital Partners experience of selling Printing, Packaging, Marketing, Engineering and Allied sector businesses, in combination with the knowledge we have of sales across these industries enables us to give a good indication of how much your business is worth.
Typically, the sale process takes approximately 11 months from start to finish. However there is no given formula to predict how long it will take; some businesses sell in a matter of weeks and others take much longer. Once your personal objectives are clearly defined and the key business issues identified, you should be able to gain a frank assessment of the timescales involved.
Whatever the timeframe, you need an adviser who will stay involved throughout, enabling you to continue running the business right up to completion, ensuring that you fully realise the value of your business.
Owners are able to significantly impact the price achieved upon sale by careful planning. It is never too early for a business owner or owners to start to plan for the eventual route out of, or succession to, the business. All businesses need to consider how best to position themselves to maximise the value or benefit to the shareholders. Apart from the obvious need to sell a business at the point in the economic cycle when company disposals are likely to be successful, owners need to ensure the business is appropriately ‘groomed’ for exit.
We will assess when the business is ready to sell and provide advice on the practical steps that you may need to take in order to help maximise value.
Yes, in all likelihood, but confidentiality is vital; a fine balance is needed between preventing knowledge of an impending sale leaking to customers and staff and at the same time ensuring that they don’t hear the news second hand. Both scenarios can be damaging to goodwill and loyalty.
Richmond Capital Partners recommends, and can help you put in place, a communications plan to pre-empt any such eventualities.
The answer is that you don’t, but we do through a number of sources.
We have an in-depth knowledge and record of acquisitive companies in the industry, and are in regular contact with our extensive network of contacts across the country, and worldwide. Additionally, we employ dedicated research analysts to track deal activity.
We know who is going to be interested in buying your business.
The sale process typically goes through a number of stages:
1. Planning & Preparation Valuation, preparing the business for sale, drafting an information memorandum about the business, researching potential purchasers.
2. Marketing & Negotiations Preparation of a bespoke marketing plan for your business developed by marketing professionals. Distributing the information memorandum, evaluating interest levels, receiving offers, negotiating and reaching agreement in principle.
3. Contracts & Completion Contract drafting by lawyers, final tax restructuring, overseeing purchaser’s due diligence, completion of sale.
Great care is required in preparing an information memorandum and controlling the release of information to prospective buyers. Too little or too much information, or the wrong emphasis in the wrong place can have adverse consequences.
During a sale, when Richmond Capital Partners manages the transaction, purchasers are provided with sufficient commercial and financial information to enable them to determine the amount that they are prepared to bid for the business.
There’s good and not-so-good news. The not-so-good news is that the sale may result in a capital gain for tax purposes (currently at 10%). The good news is that a relief is in place which operates to reduce the marginal rate of tax in respect of capital transactions. The tax rate will depend on government policy, your own personal circumstances and the nature of the transaction itself.
With careful planning the tax charge may be deferred or reduced.
The deal management team can introduce you to dedicated tax specialists whose job it is to ensure that you are left with the maximum proceeds.
Your position depends very much on your own wishes and the requirements of the buyer; it is not unsual to have a handover period but the length and time can vary enormously.
If you have strong views on what you want to do, then these can be incorporated into the discussions at an early stage.
Like most employers that we deal with, you will probably feel responsible for your employees. However, agreeing provisions to safeguard employees’ interests, over and above statutory entitlements, is not always easy.
One of the best ways of ensuring a satisfactory outcome for your employees is to make sure that the business goes to the ‘right home’. Assessment of prospective purchasers can help you achieve this.
There will always be risks associated with selling your business. Perhaps the most common is committing time and expense if a deal aborts – for whatever reason.
However, working with Richmond Capital Partners reduces risk right from the start. At all times, you remain in control of the transaction and can put a hold on the deal if your situation changes during the sale process.
The principal risk is underselling your business and that is one risk we will try to ensure you don’t take.
You can receive the proceeds of the sale in a number of ways, for example: cash, loan notes or shares in the purchaser – which will need to be established. However unless the deal is subject to an earn-out (i.e. linked to future profits, see below), a significant amount (if not all) of the proceeds should be handed over to you on completion of the sale.
We do not offer a “no sale, no fee” arrangement.
Our fees are split into two parts. The initial commitment fee is small which covers our costs but it is big enough to ensure you are committed to the sale before we engage in the hard work on your behalf. The second part is the ‘success’ fee which is contingent upon the completion of the transaction. No sale means no fee. We share the risk. We only profit when your deal completes. We do usually set a minimum charge and you will need to contact us to discuss fees. There are no hidden extras and our fees are made clear from the start.
If you have tried to sell previously without success via another broker and have an IM available or are a BPIF member then you may be eligible for a discount. Please refer to our ‘Selling’ page.
There are pitfalls to be avoided in most business situations. However, when you are selling your business it is usually once in a lifetime situation. And you need to get it right. Here are a few examples of the pitfalls to be avoided:
All marketing is conducted in complete confidence and your company name is never revealed until a non-disclosure agreement (NDA) is in place and your permission is given. The following methods are used to market client businesses which form part of an overall bespoke marketing plan tailored for your business:
1. Thoroughly researched bespoke marketing plan. 2. Contacting retained acquirer clients and other buyers registered on our acquirer database where we feel there is a strong match 3. Online advertising platforms 4. Trade journals 5. Our network of broker/M&A contacts with potential buyers 6. Personal networking through phone calls with new/existing contacts in the trade 7. Contacting those whom may have missed out on a similar opportunity we were recently selling where there is a match.
We approach private buyers/management teams, trade buyers and corporate strategic buyers alike depending on the type of business. There is no set formula. Confidentiality is maintained throughout this process.
It is extremely rare to receive consideration for your business in full as one lump sum payment at completion. Consideration is usually paid as in ‘layers’. For example, this may be as follows:
1) Cash at completion (70%) 2) Payment deferred over a number of months post completion (20%) 3) Earn-out based on a performance related mechanism post completion (10%).
In addition there may be other terms as part of the deal including consultancy and property options.
We are often asked to define these terms as, though they are in common use, many business leaders do not fully understand their respective places in this area of strategic planning. All are options for growth.
Strategic Alliance A strategic alliance is a form of collaborative relationship which is of long term strategic importance to both parties. Shares are not necessarily involved but can be (see Joint Venture below). A formal agreement is agreed after including a “sunset clause” where an option to acquire your partner is planned on agreed terms. This strategy is used to gain access to markets, technology and to facilitate growth leading to increased shareholder value.
Joint Venture A joint venture is where two parties get together and form a separate business in which they both take equity or shares, often 50:50. There is usually a formal plan to “divorce” in an agreed timescale.
Merger This is where two parties get together when neither can afford to buy the other outright. There is usually some trading in shares to reach an agreement on value and price.
Highly experienced in industry and in M&A with excellent references available upon request. Qualified to Chartered status and hold post graduate business and professional qualifications.
Yes. Once enquiries are received we check out their financial ability using our credit checking software. We also check geographical location and assess whether there is a symbiosis with your business. We will question the enquirers’ acquisition strategy. If there is a fit a non-disclosure agreement (NDA) will be signed to be signed by a director of the acquirer business. Their enquiry will then be presented to you for approval. If approved by you then the information memorandum (IM) will be supplied to them. You are always in control!
If you are a ‘reactive’ buyer you can simply review our website and let us know which of our businesses for sale listed are of interest. Once a non-disclosure agreement has been signed you will be provided with an information memorandum. You will probably hve a few questions which we will answer for you. An initial off-site meeting is then common for a further Q&A session with the vendor followed by a site visit. If you are still interested you will submit to us an indicative non-binding offer (subject to contract, finance and due diligence).
If you know exactly what you want and there is nothing suitable on our website, contact us to discuss our Targeted Acquisition Search Programme – a bespoke programme tailored to your requirements for Proactive acquirers.