Investment
Process
We are
We are investor buyers. That means we acquire businesses with the aim of keeping the employees and management teams, whilst facilitating a full or partial exit for the sellers themselves. The nature of our offer is based around the needs of the exiting sellers and the requirements of the business in the future.
Our Approach
It is as important to us as it is to you that we treat each potential acquisition as unique. So, we listen carefully to your specific needs and wants and develop plans to maximise outcome benefits for both parties.
This is not only important with regard to the deal, but also the future aims of the business, it’s staff and management teams. Unlike many trade buyers, we fully intend to retain the brand and employees so sellers need not feel they are abandoning their business and their loyal staff.
If you are considering an exit, we understand that it may be important to you that the good name and reputation of your business is maintained – this is understandable as you will have worked long and hard to build the business up over the years!
Whilst there are transactions in the industry where full payment is made on deal completion, these are relatively rare and tend to be equity-based deals where the buyer is a trade buyer. Unfortunately, in these cases post-acquisition efficiencies are often made by bringing some functions into the new parent company, which means relocations at best and redundancies at worst. The brand may also disappear, as it is consumed by the acquirer’s rival brand, which is usually larger.
At Marlborough Scott, the majority of our deals are structured with a split between a payment on completion and the balance paid over a mutually agreed timescale. The actual values and timescales vary according to the parameters of the deal and are specific to each transaction. The completion payment is paid within a short time following completion.
In theory, every seller would prefer to have all of the money on completion. However, this creates a risk to the transaction that funders are not prepared to bear and also usually lowers the overall value of the deal in exchange for more money up front. The deals which we construct ensure that the seller will receive all of the agreed funds, the value may be higher in total and the health of the company and its employees is better protected.
Where there is a significant amount of cash in the business, a deal will be structured appropriately to enable its extraction in a tax-efficient manner.
Our Process
1. Initial discussions – understand your needs and desires
2. Exchange of business financial information
3. Assess suitability of deal options
4. Meeting to discuss options and offer
5. Agree Heads of Terms
6. Conduct due diligence
7. Finalise funding
8. Completion
We Provide
What Might Happen to my Business?
You are likely to be concerned as to the fate of your business following the sale which is quite understandable. Owners are often concerned about how loyal and valued staff might be treated after a sale or perhaps the impact on their reputation with clients and suppliers.
Typical options could include:
Business Purchased and vendor retained.
Your business is acquired and we provide you, the former owner, a consultative or managerial role over a fixed term contract. This allows continuity within a business transfer, guarantees you an income stream, but frees you from the day to day hassles and responsibilities of the trading entity and allows you to get back to do what you first loved about the business when you started it.
Straight Forward Business Acquisitions.
Your business is acquired and added to a portfolio of similar business types to be managed and run within our Group. We will apply economies of scale where appropriate to optimise costs as well as concentrate buying power with suppliers. We will also utilise our sales, marketing and operations resources and expertise to help grow the business.
Business Purchased & Sold On.
Your business is acquired and sold on within a specific time frame. We have a number of private equity partners that also acquire and where suitable (and there is no conflict of interest), we may sell on the business but always ethically and with due care to the staff employed.
Contact
contact@marlboroughscott.com
