Gerald Couldrake
Partner
Howes Percival Solicitors
DESPITE the continued uncertainty derived from Brexit, 2017 definitely saw an improvement in the UK’s economy, markedly for manufacturers.
For an owner-managed business in Northamptonshire which has successfully navigated the choppy waters of the last ten years and has an optimistic future, but no obvious succession plan for its owner, the mergers and acquisitions market remains a realistic solution for an exit. In other words, there is an appetite out there to buy well-run profitable businesses and pay realistic prices. Also, there is some bank funding available for acquirers and there is definitely a lot of private equity money looking for acquisition opportunities.
The increasing confidence in the UK economy has meant that entrepreneurial businesses are looking to take advantage of opportunities by making an acquisition, and their bankers now have the appetite and ability to provide funding, including some cash flow funding. At Howes Percival we have had a very busy 2017, seeing some very good prices paid for businesses we have sold for clients. In particular, 2017 was a very active market for us acting for management teams who were not in a position to buy-out the company, but who were able to take minority shareholdings alongside a private equity buyer. The existence of a strong management team who are keen to take equity is a key component of most private equity transactions.
So now is a good time to think about selling your business. Buyers can see good opportunities for upside arising from the synergies of an acquisition, particularly where there is good reason to think that the economy will continue growing. There are still not that many good businesses for sale, meaning that those that take the plunge and look for a buyer are finding that they are in demand, setting up the ideal situation to find the right buyer at the best price achievable. Any successful disposal of a business will take several months to achieve, so for an exit during 2018 now is the right time to start planning. A call to your usual professional advisor, to take professional advice, should be your first step.
Contact Howes Percival on 01604 230400 or visit www.howespercival.com
