As we embark on the year 2018, it is important to acknowledge the advantages of engaging your business for sale. Mergers and acquisitions was strong in 2017 and is expected to continue full steam ahead moving into 2018. You can count on Benchmark International to stay on top of current trends to bring you the highest level of professionalism in the sale of your business.

Corporate and private equity executives foresee an acceleration of merger and acquisition (M&A) activity in 2018, both in the number of deals and the size of the transactions. Right now, sellers have the opportunity to take advantage of the M&A cycle as deal scarcity, a depleted stock of quality companies available for sale in the market, is still forcing buyers to pay more for businesses.

Now is the time to move quickly and ensure your future objectives because the M&A cycle is solidly in its growth phase. The demand for quality companies is at its peak. Benchmark International predicts high multiples on EBITDA to continue trending in 2018. Sellers will want to have an exit strategy in hand that allows them to sell their companies on their terms. In order to do this, it is important to evaluate upcoming changes in the M&A cycle and use these evaluations to make smart decisions for the future of your business.

Timing is of the essence. With the unemployment rate predicted to drop to 3.7 percent by the end of 2018, we could see a hike in interest rates to follow. Higher interest rates will force buyers to drive tougher negotiations with business owners looking to sell. Get the ball rolling on your acquisition process now. Beat these higher rates and lock in the deal you seek. Benchmark International is the partner to assist you from start to finish and make sure your expectations are met.

Bloomberg reports “the U.S. economy is heading into 2018 with strong momentum that’s likely to boost wages and inflation more broadly, requiring the federal reserve to raise interest rates four times next year.” These interest rates are expected to continue rising in the coming years, so now is the time to snag a desirable negotiation for the sale of your business. As the M&A cycle comes to its peak, we are here to obtain the best offer for your business.

According to CNN, there are approximately 75 million baby boomers, aged 53 to 71, who are entering into retirement. With this generation coming into retirement, there will be more businesses for sale, providing buyers with more purchasing power. This will cause a change in supply and demand, and likely drive prices of companies down. If you are considering selling your business in the next three to five years, the time to act is now.

2018 is the year to earn the deal you want for your business. Be ahead of the crowd in making your decision to commit to a merger and acquisition engagement, so you can stand firmly on your expectations and get the best possible outcome for the sale of your business. With Benchmark International’s help, you can complete your sale at the top of the M&A cycle.

The deal process can take several months, and in some cases as long as a couple years. You should seek competitive offers for your business today. 2018 is expected to be another successful year for M&A. Don’t let it pass you by and miss out on the high multiples and buyer competition we witnessed this year. Let us exceed your expectations and show you what experts can do for you. The time to start your engagement is now.

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners achieve their personal objectives and ensure the continued growth of their businesses.

View Benchmark International’s Success
Watch “Who Is Benchmark International?” (VIDEO)

Call Benchmark International today if you are interested in an exit or growth strategy or if you are interested in acquiring a business.

United States HQ CONTACT:
Sam Smoot, Director
813-898-2350
Smoot@BenchmarkCorporate.com

United Kingdom HQ CONTACT:
Carl Settle
0161 696 0000
Settle@BenchmarkCorporate.com

 

South Africa HQ CONTACT:
Anthony McCardle
21 300 2055
McCardle@BenchmarkCorporate.com

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There are many things to consider when you are thinking of a potential exit, whether it be your own personal/business circumstances, the overall M&A market or potential tax implications.

However, your decision doesn’t need to be made today or even next week. Benchmark International’s role is to undertake an exhaustive M&A strategy to source the most suitable acquirers and provide you with as much choice as possible.

Obviously, our aim is to achieve the best possible outcome (price, value, deal structure and suitable acquirer) for you and your company, but that choice won’t be available for you until months down the line – at this stage it’s just pressing the button.

So, what is it that you need to consider when you eventually get round to planning your exit? Firstly, you must consider the current market value of your business. Benchmark International has a team of dedicated M&A market specialists who closely study market conditions and variants relating to time specific market values of companies. We offer company valuations as a free service so we strongly suggest that you, as a business owner, take up this offering as soon as possible.

The next factor to consider is your current net worth and future objectives. Whether this be retirement or a change of business direction, you need to take into account your lifestyle and spending requirements.

Wealth management specialists are the most appropriate people to speak with regarding net worth and financial planning, and Benchmark International is well placed to point business owners in the right direction given that we hold very strong relations with some of the world’s leading wealth management firms.

Taking the above points into account, a decision doesn’t need to be made right this second regarding a potential exit, but it must be made regarding timing, as this is a hugely significant factor in determining the level of value received upon completion.

When you are heavily involved in the day-to-day running of a business, it is difficult to take the time out to consider something which may seem so far away, and although you don’t need to make the decision now, given the potential financial implications, it is hugely important.

Procrastination when it comes to considering and planning an exit strategy will more often than not cost owners hugely in terms of lost value. It pays to plan ahead and, considering a business tends to be the most valuable asset for a large number of individuals, the value of considering and planning for your exit in advance will be hugely rewarding when the time eventually comes to sell.

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners achieve their personal objectives and ensure the continued growth of their businesses.

View Benchmark International’s Success:
Watch “Who Is Benchmark International?” (VIDEO)

Call Benchmark International today if you are interested in an exit or growth strategy or if you are interested in acquiring a business.

United States HQ CONTACT:
Sam Smoot, Director
813-898-2350
Smoot@BenchmarkCorporate.com

United Kingdom HQ CONTACT:
Carl Settle
0161 696 0000
Settle@BenchmarkCorporate.com

South Africa HQ CONTACT:
Anthony McCardle
21 300 2055
McCardle@BenchmarkCorporate.com

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Engaging with a mergers and acquisitions firm is a huge emotional decision. It may feel like making a commitment to sell, and you aren’t sure if this is what you want. At Benchmark International, our purpose is to help our clients achieve their personal goals whatever they may be.

We know you have spent a lot of time and effort building your business, and engaging Benchmark International does not have to be a concrete decision to sell. Senior Analyst, Shannon Hess, explained “right now, it’s about letting us go to work for you to find out what might be possible for you, then you make the decision.”

Engaging with us does not mean you are making a commitment to sell your business. What it does mean; however, is gaining an insider’s look at a buyer’s perspective. Knowledge is power; and using our firm, regardless of your decision to sell or not, will certainly gain you a wealth of knowledge about your own business. You will have a glimpse into what outsiders think when they look at your company.

Understanding what buyers are looking for and how your business measures against others in the market, will provide you the insight you need to make an informed and well-planned decision in the end. The items that you feel are most important to prepare your business for sale may not coincide with those of potential acquirers.

For example, you may feel you need to expand your sales force, whereas buyers may be more concerned about your customer concentration. Given this information, you have an opportunity to make changes within your organization that are beneficial, not only in a sale, but also to you and the company itself, should you decide to keep it. We have had clients who ultimately decided to implement strategies buyers had suggested when examining their business, and they recognized improved performance for themselves as a result.

Sometimes, buyers may approach you, and you might not be thinking of selling your business. In this case, it’s essential to know what your business is worth before you proceed with an offer. In his webinar “Beware of Strangers Bearing Gifts,” one of Benchmark International’s Managing Directors, Andre Bresler, stated, “it’s important that you control your own destiny. A sale may not be what you were considering, but when opportunity knocks, there’s no downside to exploring it.” Benchmark International is here to negotiate the best deal.

Our services reveal buyers’ strategies that can be to your benefit. You will learn what it is about your company that interests them and what they see as risks. Also, you will learn how long the sales process takes and what may be involved. “If your intention is to sell your business and not be bought, you need a team with the transaction experience of your acquirer,” Bresler said. We are here to help you explore all of your alternatives.

Once you engage with Benchmark International, you are always our client. You do not need to feel rushed to decide to sell. If you decide now is not the time to sell, we will support you in that endeavor. Having an exit strategy is essential, whether you use it today or years down the road. Knowing how and when to end a business, and having a plan in place, is equally important to knowing how to start.

Gaining market knowledge sooner exposes you to current opportunities, and if you find one that works for you and your business, that’s perfect. If not, you have a new set of tools in your toolbox you can use to make your business grow under your command.

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Worldwide mergers and acquisition activity will hit £2.4 trillion ($3.2 trillion) next year, as deal-making is elevated on an increasing global economic tide, according to recent forecasts.

Investors are feeling “increasingly confident” due to a spike in global trade and GDP development across most of the world, according to research by law firm Baker McKenzie and consultants Oxford Economics.

2018 will mark a “cyclical peak” for numerous macroeconomic and financial deal drivers, pushing a substantial rise from the £2 trillion total M&A activity predicted for 2017.

The report also estimates a solid pipeline for initial public offerings (IPOs), with a hike from £143bn in 2017 to a cyclical peak of £221bn next year, which is close to record highs.

However, this figure could rise substantially if Saudi Aramco goes ahead on its intention to list. Possible proceeds from a flotation of the state-owned oil juggernaut aren’t included in the Baker McKenzie predictions owing to uncertainties over the timing and size of the listing.

That figure could rise significantly higher if Saudi Aramco follows through on a plan to list. Potential proceeds from a flotation of the state-owned oil giant are not included in the Baker McKenzie forecasts owing to doubts over the timing and scale of the listing.

According to Tim Gee, corporate partner at Baker McKenzie (London office), the UK will witness a “significant increase in domestic and inbound activity in 2018”.

Separate information from accountants EY display a noticeably increased appetite for cross-border M&A in the UK.

Baker McKenzie’s forecasts show a 60% year-on-year growth in M&A deal value in 2018, before dropping back to 27% lower than 2017 by 2020, as the UK makes it exit from the EU.

UK inbound activity has been handed a boost by the weakening of sterling, which has made businesses more appealing for foreign investors, yet uncertainties over the shape of future trade relationships have triggered some caution from companies.

Baker McKenzie’s global chair, Paul Rawlinson, said: “After a few soft patches in 2017 we have a more optimistic outlook for the global economy and deal-making in 2018, as long as the brakes are not put on any further on global free trade.

“We see an uplift in both M&A and IPO activity as deal-makers and investors gain greater confidence in the business prospects of acquisition targets and newly listed businesses.”

Global M&A bottom

A recent article in the Harvard Business Review made a perhaps surprising conjecture: that as far as mergers and acquisitions are concerned, those companies that focus on what they’re going to get from an acquisition are less likely to succeed, in terms of the deal outcomes, than those companies that focus on what they can give to the process.

Acquiring companies being in ‘take’ mode was a dangerous place to be, it claimed. Indeed, corporate giants are not immune from this conundrum either, if we think about, for example, Microsoft and Google wanting to get into smartphone hardware in ‘taking’ from Nokia and Motorola respectively.

A buyer in ‘take’ mode means that the fortunate seller can increase price, especially if there is more than one potential buyer in the picture, and effectively remove the future value of the transaction. Buyers on the take, really knowing what they want, are also more prepared to pay top dollar – which, in and of itself, poses a problem in eventually getting a good return. But companies with a ‘getting’ focus also tend to lack adequate understanding of their new markets, making failure even more likely.

Having something to give to the deal, however, really benefits outcomes. This could mean anything that makes the acquired company more competitive in its market, and especially if the buyer is the only partner who can offer this new competitive edge.

The much-talked-about Harvard Business Review article listed four main ways that the ‘giving mode’ buyer can increase the competitiveness of the bought company and ultimately secure better outcomes on the deal:

  1. Providing growth capital

This works particularly well if you’re investing in countries with less developed capital markets, such as India. But the model also works well if the investor is providing growth capital in newly-emerging or fast-growing sectors where there’s a lot of competitive uncertainty, for example in the burgeoning virtual reality market a few years ago.

  1. Providing better management

‘Better management’ here can in fact mean strategic direction, discipline or organisation – or, even better, a combination of all of those. Private equity buy-outs are really the wellspring of this model, although it can work in any form.

  1. Transferring valuable skills

These can be transferred directly or through re-deploying specific personnel, but the skills have to be critical to giving a competitive advantage, and the buyer has to possess them much more than the seller does in order to make this model work. Also, the seller needs to know the new business quite intimately to be able to really discern which skills hit the mark here.

  1. Sharing valuable capabilities

Here, the acquiring company simply makes skills or assets available to the bought company, rather than transferring them over. This model requires a good understanding of strategic dynamics.

To summarise, what the buyer puts into the deal determines the outcome of the deal. It’s a strangely ‘warm’ sentiment to find in a serious journal discussing the M&A sector, but in essence we’re really only talking about different approaches to the deals in question.

In thinking about your current plans, are you an acquirer in ‘getting’ or ‘giving’ mode, or a seller who stands to benefit from dealings with a giving buyer?

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The Chancellor of the Exchequer, Philip Hammond, yesterday unveiled his Autumn Budget to Parliament, which grabbed the headlines with its announcements on stamp duty, housing, the NHS and the National Living Wage.

Amongst the headlines, however, there was some encouraging news for business owners and entrepreneurs, despite some of the continued uncertainty around Brexit.

One of the biggest talking points to be revisited from previous budgets was that of the cut to business rates. Plans to have business rates rise in line with the lower Consumer Price Index (CPI) measure of inflation instead of the Retail Price Index (RPI) have been brought forward by two years and will now take affect from April next year. The Chancellor said this move is going to be worth £2.3bn to businesses over the next five years.

Technology and innovation were at the heart of the Autumn Budget this year. To help the UK secure its future in digital and technological innovation, Hammond pledged to unlock more than £20bn of new investment in UK scale-up businesses in a bid to develop the UK’s digital industry, and have a new tech business founded “every half hour”. This was further cemented with the announcement that the government has set aside £2.3bn for investment in research and development for scale-up businesses across a number of industry sectors.

There was positive news with the announcement that the threshold at which small businesses start paying VAT will not be lowered from £85,000, although further consultations are still to take place in this regard.

Thousands of small business owners will also be celebrating the abolition of the so-called “staircase tax”, in which companies operating over several floors within the same property were handed separate business rates assessments for each occupied floor, as opposed to one bill for the entire premises. The Chancellor used the Autumn Budget yesterday to call time on this unpopular levy.

Much was also made of the government seemingly pushing ahead with previous Chancellor George Osbourne’s ‘Northern Powerhouse’, and the ‘Midlands Engine’, with the introduction of the new £1.7bn Transforming Cities Fund. The fund will target projects that drive productivity by improving connectivity, reducing congestion and utilising new mobility services and technology in northern cities such as Manchester and Liverpool.

Although there were winners and losers in the Autumn Budget there remains much to be positive about for business owners.  If you would like to talk about your exit or growth plans for the future please get in touch, and let Benchmark International’s experienced team help you understand your options.

 

Benchmark International is pleased to announce that a deal between Sui Generis Holdings Limited to Milbank Concrete Products Limited has been agreed.

Sui Generis Holdings Limited was established in 1996 with the intention to specialise in bespoke fibreglass mouldings. However, at any stage the versatility, robustness and consequent massive potential of fibreglass was recognised and gradual progression has seen the company become experts in a wide variety of fibreglass applications including Fibreglass Linings, Fibreglass Grating, Anti Slip Flooring Products and Spill Containment products.

Milbank Concrete Products Limited is one of the UK’s leading manufacturers of precast concrete products with a focus on exceptional customer service. Their trading history spans over 70 years and they are dedicated to helping their customers achieve success. Milbank regularly produce a wide range of precast concrete components from hollowcore flooring systems to stadium terracing.

Andy Mayne, Managing Director of Milbank Concrete Products said: “Whilst Sui Generis may sell different products to Milbank, we are in fact very similar. Both companies design, manufacture, deliver and install products along with dealing directly with the end consumer, continually focussing on reliability and excellence. We believe that with our resources and the combined expertise from both companies’ personnel, we can add further growth and success to the Sui Generis business.”

On behalf of everyone at Benchmark International, we would like to wish both parties every success for the future.

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners with achieving their personal objectives and ensuring the continued growth of their businesses.

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We’ve recently been seeing at first hand the rise in medical and healthcare sector mergers and acquisitions both domestically and internationally, with Dublin-based Clanwilliam Group’s synergetic acquisition of Cheshire-based NHS technology provider Medisec (brokered by Benchmark International) the most recent example.

Greater private sector involvement in the NHS has long been predicted thanks to a competition-opening process begun way back by the Blair administration and further strengthened by the Health and Social Care Act, but the snap-up rate in the industry is still striking.

Led by M&A in the domiciliary care sector, which has after all been dominated by private equity since the late 1980s, the NHS has seen increasing government promotion of private-sector models alongside a more positive environment for outsourcing services and for consolidation and M&A.

The ongoing digitization of the NHS is also a factor behind the UK sector’s M&A readiness, with Medisec being part of a wider movement towards acquisition for synergetic expansion. Digitization is really helping drive innovation across the healthcare sector, and here mergers and acquisitions are playing an important role.

While risks associated with the general medical and healthcare sector include tight legislation around pharmaceuticals sales and patent expirations, these are off-set in the larger companies by the famously deep pockets of ‘Big Pharma’.

In smaller companies and start-ups, however, M&A often presents a real opportunity to bolster pipelines to market and to improve efficiency. That’s what we’ve been seeing here at Benchmark, and it’s a great example of mergers and acquisitions helping drive growth in the UK.

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Benchmark International is pleased to announce that a deal between Levy Brothers & Knowles Limited (LBK) to NNZ has been agreed.

LBK Packaging has been established since 1831 and as one of the UK’s leading independent packaging suppliers, they offer a full range of flexible packaging products from their bases in Liverpool and Glasgow. LBK’s packaging is compliant with all EU food packaging regulations, and their experienced sales team is always on hand to offer advice on the very best available form of packaging to promote, protect and transport your products in the UK, Europe and the rest of the world.

Established in 1922, NNZ is a multinational company that creates packaging solutions for their clients in the fresh produce and industrial market. Today, NNZ has grown into an organisation with more than 200 employees and due to their close cooperation with their partners in 40 other countries, NNZ provides packaging solutions to a worldwide customer base.

The acquisition significantly increases NNZ’s share within the agricultural and industrial packaging markets. “We are absolutely delighted that LBK is joining NNZ. We are genuinely excited by the prospect of bringing further value to our customers by combining the expertise and product offering of the two long-standing companies”, said Brian Keasey, Managing Director of NNZ UK.

On behalf of everyone at Benchmark International, we would like to wish both parties every success for the future.

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners with achieving their personal objectives and ensuring the continued growth of their businesses.

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‘Green-washing’ is pretty much endemic in the business world, with every company worth its salt aiming to showcase its environmental credentials, whether rightfully or as a PR exercise.

But environmental factors can be absolutely crucial in mergers and acquisitions, and can make or break some deals.

Buyers are right to carefully consider any potential environmental issues that the target company might face, and in some sectors this can be key.

Here’s our whistle-stop guide to what needs to be considered ahead of a due diligence environmental review:

  • Any existing environmental litigation, investigations or other current claims relating to environment, toxic substances and so on

 

  • Environmental permits and licences used by the company

 

  • Any contractual obligations that the target company may have relating to environmental issues

 

  • Thorough and up-to-date environmental audits for any property owned or leased (which may well also include the auditing of neighbouring properties not owned by the target company)

 

  • Checks around any hazardous substances used by the company in any of its operations, including asbestos

 

  • Checks around any petroleum products used on company property, other than by passenger vehicles

 

  • Comprehensive correspondence files relating to any local or national environmental regulatory agencies

It’s essential that the target company carry out its own internal audit ahead of going to market, and that all records regarding environmental issues are checked as current and made easily available.

This will go a long way to impressing upon any potential buyers that environmental issues are taken seriously and are under control in the business.

It’s corporate citizenship as well as environmental stewardship in action, and it will show buyers that you’re on top of this increasingly scrutinized area.

For more information on environmentally-related or other preparations for the M&A process, contact our expert team.

 

Benchmark International has successfully facilitated the sale of Canaide, Inc. to Apprio Holdings, LLC.

Canaide, Inc., hereinafter referred to as Canaide, is a revenue cycle management firm located in Central Florida. They are a provider of outsourced, self-pay services to hospitals across the Southeastern United States. The acquirer, Apprio Holdings, is a provider of specialized technology solutions, particularly for the Health, Defense and Homeland Security markets. They are headquartered in Washington, D.C. and now have 11 total offices from coast to coast.

Art Seypura, owner of Canaide, stated, “Benchmark made the sales process timely and seamless. We went to market just a few short months ago and they quickly found a great cultural fit that would allow me to step away quickly from the helm while partaking in future growth under the guidance of Apprio.”

Benchmark International Director, Dara Shareef, stated, “We are really excited that we were able to successfully locate a buyer for Art Seypura and Canaide. Every facet of this process, from engagement to close, went smoothly thanks to the dedication and effort from both the sell-side and buy-side teams.”

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners achieve their personal objectives and ensure the continued growth of their businesses.

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broker transaction between Silexx Financial Systems, LLC and Chicago Board Options Exchange

Benchmark International has successfully facilitated the transaction between Silexx Financial Systems, LLC and Chicago Board Options Exchange (CBOE). Headquartered in Chicago, IL, CBOE is the largest U.S. options exchange in the nation. Silexx Financial Systems, LLC is a broker-neutral, multi-asset class trading platform in Sarasota, Florida.

Thomas Frey, president and majority owner of Silexx Financial Systems, LLC stated, “I would like to thank Benchmark International for their persistence, and focus during this transaction. As is often the case, this transaction faced numerous challenges during each stage of the process. The Benchmark team remained focused, and leveraged their experience to maintain forward progress during difficult times of the process.”

Benchmark International Director Dara Shareef stated, “We would like to congratulate our clients, Silexx Financial Systems, LLC, Thomas Frey, and Michael Williams, as well as the buyer, Chicago Board Options Exchange. This acquisition enhances the CBOE delivery model and provides its customers industry-leading data analytics and trade execution tools for more than three dozen global markets. The buyer truly valued our client’s existing OEMS platform and access to major global markets in North America, Europe and Asia. We feel this deal was a win-win proposition for both CBOE and Silexx, and we wish them both all the best in the future.”

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 14 offices across the world, have assisted hundreds of owners achieve their personal objectives and ensure the continued growth of their businesses.

broker transaction between Silexx Financial Systems, LLC and Chicago Board Options Exchange

 

Benchmark International is pleased to announce the sale of Topcrete Limited (inc Allen Concrete Limited) to SigmaRoc for a total deal value of £17.1m (including assets extracted by the sellers totalling £4.6m.

SigmaRoc Plc is an AIM listed company that invests in and operates new and existing construction material assets, in places where opportunity is greatest.

Chairman David Barrett said: “We are very pleased to welcome Allen Concrete to the SigmaRoc group, it has a solid history and is highly regarded in its sector. This is another step in our ambition to generate shareholder value while preserving the unique identity of the businesses we buy.”

Allen Concrete is a specialist precast concrete producer, that is best known for its high-quality wetcast and bespoke concrete products. Additionally, it supplies a wide range of clients ranging from builders’ merchants to major infrastructure operators, including Network Rail.

Nick Hulme, Managing Director, Benchmark International commented:This deal represents the coming together of two great companies, with both the seller and buyer having extensive industry knowledge. A great transaction for all involved.”

On behalf of everyone at Benchmark International, we would like to wish both parties every success for the future.

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners with achieving their personal objectives and ensuring the continued growth of their businesses.

Benchmark International Advises on The Sale of Levy Brothers & Knowles Limited to NNZ

There is still the chance for you to capitalise on the extremely low 10% capital gains tax rates which are on offer via Entrepreneurs’ Relief, whenever you fully or partially sell your company.

However, time is running out as there are already signs from the government that they will be applying the brakes on small business owners, by clamping down on the numerous available tax breaks for entrepreneurs.

The Budget in 2015 was the first instance where these brakes were applied on Entrepreneurs’ Relief, by limiting the kinds of people and businesses able to claim it.

Ultimately, the total amount successfully claimed against capital gains tax bills is expected to drop from £3.5 billion of the previous two years to £2 billion in 2017, according to the HMRC.

It is looking increasingly likely that in the absence of any rise in income tax or national insurance rates, capital gains tax could be targeted in order to help fund public services.

With the recent increase in tax rates on dividend payments, as well as the rise in tax-free dividend allowance, it is clear for all to see that business owners will soon begin to feel the squeeze, with the General Election providing little in the way of reassurance.

Additionally, with the recent talk regarding a possible relaxation of the wage cap within the public sector, it would appear that further measures are in place to come down hard on entrepreneurs’ tax breaks.

Therefore, if you are considering a sale of your company, do it sooner rather than later.

If you are seeking advice on this topic, then please feel free to call us on 0161 359 4400.

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Technology-related mergers and acquisitions are set to remain robust over the next 12 months, according to the recent semi-annual leaders’ poll from law firm Morrison & Foerster’s global M&A team.

In spite of something of a slowing-down of the M&A market generally in recent months, with tech deals globally having fallen in the first three quarters of the year and a deal-making plateau predicted in some quarters, tech leaders are of the opinion that deals in their sector will hold fast for the coming 12 months.

In the survey, just over half of tech leaders who were polled said that they were confident that tech deals would be buoyant over the next year (compared with the previous year), while just 19% predicted a slowdown.

The growth trajectory is expected to hold firm given new tech innovations and healthy private equity spending, according to Morrison & Foerster. It’s worth noting also that the M&A KnowledgeBase from 451 Research also acknowledges 2017 as the first year ever on record where private equity firms have announced more tech sector acquisitions than public companies.

In the sector itself, artificial intelligence and machine learning are predicted to be the particularly strong drivers of tech M&A over the next few years, outweighing the ‘Internet of Things’ which drove the highest-value deals in 2016, of which over half involved ‘connected car’ technologies.

2016 already brought an all-time high for tech M&A globally, with cloud computing, social networking, smart mobility, cyber-security and big data analytics performing particularly strongly and helping the sector neatly out-pace other markets.

So, with activity predicted to remain strong, keep an eye on tech deals as the ones to watch again this coming year.

M&A TO REMAIN STRONG IN THE NEXT 12 MONTHS

Health IT mergers and acquisitions are now gaining traction, and at a rapid rate. While there are a number of reasons for this, the ultimate driving force is the shift from fee-for-service to value-based care.

Providers want and need innovative health IT tools in order to meet the current demands for high-quality care, but roadblocks prevent the seamless integration and use of these tools. The most critical offender is the lack of compatibility. Provider frustrations over this lack of coordination and adaptability will peak in 2019, with vendors expected to feel the brunt of this challenge. The result is predicted to be a surge in health IT M&A, with the aim of maximising innovation while enhancing integration.

As the era of health IT M&As approaches, now is the time for companies to prepare. Whether the potential acquirer or acquisition target, big or small, public or private, health IT companies need to prepare well in advance for M&As and keep the following points in mind.

For the Acquirers:

  1. Leverage an outside expert –Tap trusted outside experts to ask questions about the type of technology you’re looking at acquiring. It’s worthwhile learning as much as possible about the technology, such as how it compares to competitors and its potential for either success or failure. This will enable you to make a better-informed decision on whether the technology would be a suitable fit within your company, while also showing your prospects that you know what you’re talking about.

 

  1. Utilise your tech team – While outside knowledge is important, don’t forget to go to the people who are already onboard. Your own tech team is a valuable resource that provides on-the-fly answers to any knowledge gaps you may have on the technology. The team will have the capability to provide additional insights and ideas you may not have taken into consideration. Ask your engineering lead to estimate the time and capital required to integrate the technology you are interested in, and apply it to your business plan.

 

  1. Examine the facts –Ensure you dig deep and source factual evidence that supports your desire to purchase the company. Once done, use this logic to plan an integration strategy prior to making any decisions, however, be realistic and not optimistic.

For the Acquirees:

  1. Take ownership of your strengths and weaknesses – Companies that are wishing to acquire you are on the look-out for technology that will make their existing portfolio even stronger. Place a real emphasis on fully developing your company’s core technology solution and position, and ensure that there is clear customer value. When it comes to weaknesses, be honest and open. If you can show the acquirer how they can improve or lessen the weakness, it will make you a stronger acquisition target to acquirers.

 

  1. Have your financials in place – If you aren’t producing positive cash flow, curb your spending to focus on the necessities. For a start-up, this equates to focusing research and development on core technology, demonstrating dedication to the solution and showing potential acquirers the areas of your company that hold enough value for investment.

 

  1. Compel potential acquirers – The acquirers should be made to feel that they can do a better job at running the business, as they are acquiring the technology with the idea of making it even more powerful and effective. Be proud of what you have built, but don’t be defensive.

Companies that fail to prepare for the M&A era will be left behind, therefore its essential for health IT vendors to develop plans and strategies internally in order to protect and advance their innovations.

Additionally, while the level of chaos and competitiveness might seem somewhat scary at first, it is important to bear in mind that M&As provide opportunity. These deals are meant to enhance technology innovation in healthcare and ultimately contribute to the improved health of the patient population. Therefore, if you find a suitable partner and make the right deal, it will be a home run for the future of healthcare.

A fascinating report has been published by Intralinks who, in conjunction with Cass Business School in London examined 23 years of data from almost 34,000 companies worldwide to identify the factors that make companies attractive M&A targets.

Whilst worth reading the full report, it concludes with a summary of six vital signs business owners should be aware of to make their company attractive to buyers.

The study found that in any year approximately 12% of all companies become the subject of an acquisition approach every year and whilst our own observations of the results achieved when companies are bought, as opposed to sold, are a topic for a different article, the parameters to assess when considering the saleability of a business are relevant in both circumstances.

The report clearly highlights that the measurements used to predict likely targets for acquisition differ distinctly when considering the attributes deemed desirable by private equity, and those by trade buyers. The metrics also draw a clear distinction between these factors when targets are differentiated between public and privately-owned companies.

The 5 factors that rank a privately-owned company’s propensity to be approached were reported to be:

Sales Growth – companies with positive sales growth in the three years prior to approach reflect as desirable targets. Target companies demonstrated a sales growth rate 2.4% higher than non-target companies.

Profitability – EBITDA to Sales ratios measured 1.2% higher in target as opposed to non-target companies.

Leverage – In the Intralinks/Cass report this factor was deemed to be the #1 predictor of whether a company would become a target. Interestingly corporate acquirers (trade buyers) favoured low debt/EBITDA ratios. Private Equity acquirers, on the other hand, sought a demonstrable ability to support debt and targeted companies that had leverage as high as 3 times that of the non-target companies.

Size – This was deemed the second most important predictor of whether a company might become the target of an acquisition – private company targets were 40% larger than their non-targets peers.

Liquidity – Liquidity of target companies, as measured by their ratio of current assets/current liabilities, is 4% lower than that of non-targets. Companies in the bottom two deciles for liquidity are on average 35% more likely to become acquisition targets in any given year than companies overall.

M&A forms an integral part of corporate company growth strategies and is the purpose for the very existence of Private Equity – The Intralinks/Crass study, therefore provides valuable insights for owners of private companies seeking to groom their business for an eventual exit.

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In spite of the uncertainty surrounding the meat processing sector in Ireland, M&A activity involving participants within the sector has continued apace in 2017, with the conclusion of some notable deals.

Now, whilst there is a whole host of reasons underpinning this M&A activity, a number of common themes are evident, with the continued push for scale being the first. In an industry where operating margins are traditionally tight, top-line growth is vital for meat processing businesses to grow and prosper.

In a developed economy such as Ireland, growth by acquisition will usually outstrip organic growth in this sector in terms of pace, and hence businesses are attracted to purchasing other players in the sector as a means to achieving scale.

Scale also facilitates additional cost efficiencies, which is another key motivating factor behind many M&A deals.

Recent deals in the domestic meat sector in Ireland include: the purchase of Wilbay Ltd, a leading meat wholesaler, by Monaghan-based sausage producer Arthur Mallon Foods in 2016; and the acquisition by O’Brien Fine Foods of Faughan Foods, from Hogans Turkeys in 2017.

However, with the size of the Irish market and competition regulation acting as a constraint on growth by domestic acquisition for some players, businesses have sought to acquire international operators as a means to satisfy their growth aspirations.

A recent Irish success story in France was the acquisition by Liffey Meats of a majority shareholding in the French meat processor Chiron Viandes, which specialises in producing frozen hamburgers for supermarkets.

We have seen foreign meat-processing companies seeking the knowledge and expertise of established Irish operators, in order to improve their businesses.

Groupe Terrena, the co-operative group and owner of French processor Elivia, saw the benefits of bringing in Irish-headquartered Dawn Meats as a partner to its beef processing business.

This is a true reflection of Dawn’s excellence in the global industry, as well as the international recognition of Ireland’s expertise in grass-based meat processing.

The recently announced strategic partnership between Dawn and Northern Irish meat giant Dunbia, will provide Dawn with a Brexit buffer via Dunbia’s considerable UK presence, as well as cementing its UK supply chain.

The emerging markets (India, Indonesia, China, Malaysia) will increasingly drive global growth in the meat processing sector, with the focus predicted to shift more and more to these markets in order to be close to an ever-growing customer base.

Access to the Asian market could make Southern Hemisphere processors attractive to Irish companies.

While China’s meat imports have exploded in volume terms over the past couple of years, as well as the market being opened to Irish exporters, the vast majority of this demand has been satisfied to date by both Brazilian and Australian processors.

New Zealand, with its similarities to Ireland in terms of both climate and abundance of grass, is a region which could be explored by Irish deal-makers.

The high availability of capital, both debt and equity, is another major factor driving M&A activity in both agricultural and non-agricultural sectors.

With banks supportive of well-presented and credible growth plans, would-be acquirers are being given the opportunity to pursue value-adding targets. Additionally, the uplift in valuations being generated by this availability of capital is proving attractive to any potential sellers.

With the low-yield environment likely to persist and an abundance of private equity funds yet to be deployed, there is no indication that M&A activity within the meat processing sector will slow-down anytime soon.

M&A ACTIVITY- MEAT PROCESSING SECTOR

Of all the obstacles inherent in the M&A process, something that’s often overlooked is ‘the people factor’ – that’s to say, understanding, planning and correctly valuing the HR and employment side of a business, as well as company culture – an aspect that’s crucial when two companies come together.

A 2016 survey by KPMG showed that a staggering 54% of executives said that HR and corporate culture issues were the most significant issues they faced when integrating companies.

But why is the people factor such a challenge?

Firstly, whatever the apparent synergies and ‘fit’ of two organizations, they’re bound to have in-house cultures that differ, because just as with people, no two companies have exactly the same personality. Those differences could be slight, or they could be vast. People’s understandings (plural!) of the company’s goals to date may not match up, or the more fluid ‘company ethos’ could be quite different from the businesses you’re going to be dealing with. All of these can present issues for even very experienced business leaders when there’s a ‘marriage’ of workforces.

Secondly, business owners often feel they have a good grip on their company – but much of that is rooted in understanding the business, the products or services offered, the competitors, the market, the figures – and the staff ‘as seen from’ the CEO or MD point of view. In fact, staff members very often don’t behave or think in the way the business owner perceives them to, and this needs to be understood up-front before going into any M&A process.

So how does your staff really feel about your organization? How well do staff members understand its goals? And importantly, how well do staff actually perform in their given roles?

Very many companies just don’t have this type of information in data formats that are valuable to potential buyers or partners. There are often skills gaps and development requirements, staff-wise, that the business owners just have no idea about – but which might be glaringly obvious to an outside eye. And in the M&A process, you’re going to be under the unflinching gaze of an outside eye.

So how can you make sure you understand your people before selling or merging your company?

Investing in a good diagnostic tool makes sense as a first step. Here, you can get an idea of likely behaviours, as well as better insights into each individual’s specific role. What’s more, the results here will give you real people-centred data that will prove invaluable during the M&A process, because it demonstrates competences as well as highlighting areas that need work.

Don’t be afraid to do what’s necessary to gain a clearer understanding of your own staff before someone else goes over it with a fine tooth-comb. Give yourself the luxury of time to do this, and you’ll be able to tweak what needs changing well before the very serious task of selling or merging your company.

People Centred Data- A Crucial Tool in M&A (1)

Benchmark International has successfully negotiated the sale of Central Florida Solar, Inc. (“CFS”) to Wayfare Impact LLC (“Wayfare”).

Based in Altamonte Springs, Florida, CFS operates as a multi-service solar energy provider that designs, sells and installs solar energy systems for water heating, pool heating and solar electric power. The company primarily services the residential sector across the Orlando, Florida market. The company’s owner, Bill Park, has been designing and installing solar energy systems since 1984 and has completed the Florida Solar Energy Center’s photovoltaic system design program.

Since 2000, CFS has been committed to providing clean energy options that are both cost effective for the consumer and environmentally friendly. Since inception, the company has grown from a small family business to a profitable venture. The company’s technical knowledge, experienced staff, and professionalism not only ensure client retention, but foster additional growth opportunities within the industry.

Headquartered in Miami, Florida, Wayfare is a privately-owned investment firm with a focus on U.S. investments. Wayfare pursues a multitude of sectors and markets from an investment standpoint; however, the group primarily focuses on growth companies with clear potential to be not only profitable, but to have a positive impact on the environment. Today, Wayfare is further expanding its portfolio of socially responsible and environmentally conscious companies with the acquisition of CFS.

President and Founder of CFS, Bill Park, stated, “Benchmark International played an instrumental role in bringing my exit strategy to fruition. The team did an outstanding job of marketing my business toward motivated buyers, and even lined me up with first-rate legal counsel as the deal entered more mature stages. I would like to thank the Benchmark transaction team for the extraordinary effort in making this transaction a reality.”

Benchmark International’s Senior Associate, Trevor Talkie, added, “We have really enjoyed working with our client, Bill Park, and bringing to the table an acquirer with many of the same core values. Bill has built an excellent business over the years and this acquisition by Wayfare is a testament to the value CFS provides. I’d like to take this opportunity to wish both parties the best of luck moving forward.” Tyrus O’Neill, Director at Benchmark International, stated, “It was a pleasure to represent CFS in this transaction, and on behalf of Benchmark International, we are extremely pleased with the outcome. A win-win for the buyer and the seller is always an ideal end result.”

ABOUT BENCHMARK INTERNATIONAL

Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners achieve their personal objectives and ensure the continued growth of their businesses.

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