Benchmark International is pleased to announce that Derbyshire-based Woodall Group has secured a £4.25m investment from BGF.

Woodall Group, the owner of Woodall Homes, is an independent housebuilder, specialising in mid-market homes and providing a turnkey service from identifying brownfield sites, securing purchase options, and applying for planning permission, through to construction and fit-out.

BGF is the most active growth investor in the world, providing growth capital for small and medium-sized enterprises in the United Kingdom and Ireland, making initial investments between £1m and £15m. It has 16 offices across the UK and Ireland including London, Edinburgh, Belfast, and Dublin.

Known for its strong emphasis on premium finishes, build quality and a housing design that complements local surroundings, with sustainability embedded in the construction process, the funding will support Woodall Group deliver more high-quality properties and create further job opportunities.

Cash for Kids launches Mission Christmas each year to provide gifts for children who may not receive a present under the tree on Christmas Day. In this tumultuous year, the charity needs donations more than ever as more families unexpectedly face poverty.

Working with community organisations, social workers, schools, other charities and the emergency services, Mission Christmas ensures gifts donated reach children living in poverty.

Inspired by the work the charity does, Benchmark International decided that in place of gifts for suppliers it would donate presents to Mission Christmas, which will be distributed to disadvantaged children across the North West, hoping to bring some Christmas cheer to families during these difficult times.

Benchmark International is delighted to announce the sale of leading variable speed drive and control systems integrator, Oracle Drive Systems, to Veruth Holdings, owner of Europa Components plc and other companies, through sell-side advisers Benchmark International and Primas.

Veruth, a second-generation family holding company, has a policy of long-term development and growth for the companies it is involved with. It is delighted that John Mullins, founder of Oracle, is remaining as Sales Director.

Oracle will continue to build on its 16 years of experience and expertise with many blue-chip companies now with the backing to expand. Already in the last month new offices have been opened in Billingham in the North East of England, adding to the Batley unit in West Yorkshire, as well as taking on more project engineers and support staff to handle the new work the company is being awarded.

Benchmark International is delighted to announce the sale of Stockton-on-Tees food packaging firm, Tom Walker & Sons (TWS), to Glasgow-based food ingredients group, HMS.

Established in 1982, TWS is one of the UK’s leading distributors, importers and packers of cheese products, supplying to a national retail and wholesale customer base. Services include cutting and packing, co-packing, new product development and national chilled distribution of a vast selection of cheeses, including Cambozola cheese, of which it is the sole UK distributor.

HMS and its subsidiaries are one of Europe’s largest food ingredient distributors. Established in 1992, HMS has a turnover in excess of £210m and provides UK and European coverage through a network of six warehouses and 73 vehicles. The acquisition of TWS will allow the company to benefit from adding additional food products to its current offering.

Following the acquisition, TWS will continue to operate as a stand-alone business and will be headed up by Russell Eley who will take over from Peter Walker, the current managing director.

Benchmark International is pleased to announce the acquisition of Manchester-based Development Processes Group (DPG) by Glasgow-based ICS Learn, backed by Primary Capital.

DPG was established in 1991 and is a training and development provider specialising in CIPD qualifications to both B2C and B2B clients via online courses, traditional classroom workshops and blended online content.

Founded in 1889, ICS Learn has been a pioneer in distance learning for more than 130 years. It is an online learning provider with over 25,000 current students, offering award-winning courses with unlimited tutor support and operating over 100 countries.

Both companies will combine their collective knowledge and talent with the aim of delivering an unrivalled experience for students starting or advancing their career in HR.

Benchmark International is pleased to announce the merger between Peterlee-based Bailey Group and London-headquartered SKS Business Services.

Founded in 2006, Bailey Group is an award-winning independent group of accountancy firms operating 10 practices throughout the UK, providing the preparation of management and final accounts, as well as auditing, cloud accounting, tax advice and planning.

SKS is one of the fastest growing SME-focused finance outsourcing, accounting services and tax/business advisory firms in the UK.

Its biggest merger to date, the aim of the transaction is to allow SKS Business Services to expand into the North East. The addition means that SKS now has a presence in five out of the eight UK regions, including the East of England, the South East of England, London, the North West of England, and now also the North East of England.

Going forward, Bailey Group will now be known as SKS Bailey Group and the combined entity now contains twenty-five offices across the UK and with nearly 11,000 SME clients.

Benchmark International is proud to announce that James Robinson, Associate Director for the Manchester Transaction Team, has been awarded ‘Young Accountant of the Year’ by Insider Media as part of its North West Young Professionals Awards 2020.

This award is for accountancy-related professionals and includes people working in professional practice and in the finance teams of corporate businesses.

Due to the Covid-19 pandemic and subsequent restrictions, no awards ceremony took place this year, but the achievements of those across a range of sectors including banking, accountancy, law, property and marketing, are still being honoured.

Benchmark International has completed a state-of-the-art fit out at our new offices, One New Bailey, creating a flagship home for our Manchester Transactions Team.

One New Bailey was chosen for its prime location on the banks of the river Irwell, in the heart of the city, adjacent to Manchester’s elegant financial centre, Spinningfields.

The interior very much personifies our international brand, enriches our company culture and is the perfect home for our high performing M&A team.

Benchmark International is pleased to announce its new flagship office at One New Bailey, Manchester.

Benchmark International is delighted to announce the sale of Birmingham-based company, Software Enterprises (known as Global Rostering System – GRS), to Totalmobile.

Established in 1995, GRS is a software development company that has produced its own computerised rostering system which builds efficient staff rosters and ensures the right staff are assigned to the required locations and shifts. The product is best suited to the emergency services and 24/7 operations with customers predominantly hospitals, police forces and ambulance services. Solutions are currently being used to roster over 100,000 emergency services field-workers in the UK.

Totalmobile develops and supplies enterprise application software that manages the workflow of mobile workers. It is backed by private equity company, Horizon Capital.

Going forward, GRS’ software will be rebranded and integrated into Totalmobile’s comprehensive suite of SaaS field service management products.

Benchmark International is delighted to announce the successful sale of Essex-based Knowles Associates and Ensure UK, to an employee ownership trust (EOT).

It is now well-documented that care homes have been closed to visitors since early March, leaving already vulnerable residents feeling isolated and cut off from family and friends. Hospices and hospitals have also been forced to put severe visiting restrictions in place to protect people in their care.

In many instances, it has been the carers, themselves, going above and beyond by letting those in their care use their own personal devices to reach a family member, and to keep in touch with loved ones by video, particularly where the residents do not otherwise have access to technology.

In the most tragic cases, the devices are used by patients saying goodbye to their loved ones for the last time.

Like many businesses, Benchmark International has been keen to find ways of supporting those on the frontline. As a technology-driven business, we are fortunate to have facilities that enable seamless communication around the world, and we recognised an opportunity to make the same facilities available to the most vulnerable in our community, with the hope of bringing them some comfort during difficult times.

Nick Hulme (Managing Director, Manchester UK) summarises his recent article, ‘7 Pointers from 30 Years’ Experience in the UK’, in this short blog.

1 - It’s Not Just About the Numbers!
Although the normal formula for valuing a company involves multiplying ‘earnings’ by a chosen ‘multiple’, a company is only worth what a buyer is prepared to pay for it.

The numbers are important, of course, but there may be more to the opportunity than the numbers show. Advisers need to take a ‘bird’s eye view’ and focus on those factors that will drive the highest value with the right buyer, not just on the numbers.

They should constantly focus their conversations and analyses on the opportunity, despite the maze of numbers that fly around.

2 – ‘Multiples’ are a Minefield
Desktop research, comparisons to quoted P/E ratios and the considered views of trusted advisers can create a myriad of distortions as to what might be the correct multiple for a company.

It’s easy to see how factors such as growth, a great management team, high margins and, nowadays, tech-enablement will not only deliver the best multiples but add to that the impact of both competitive tension and structure. Any first-time seller could quickly have their heading spinning.

Benchmark International’s Valuation Matrix is a great tool for showing clients a range of valuation scenarios based on different multiples and views of earnings. This is used to educate clients from the start, and to hand-hold them to making the right decisions when the time comes. It is normally updated throughout the process.

3 – There’s More to Earnings than Reported Profits
Getting a real understanding of underlying earnings will be far more important to any buyer than what’s recorded in the company’s annual accounts.

The term we use in the UK for a fair assessment of sustainable adjusted earnings is ‘Maintainable Earnings’. This will often take account of the adjustment of shareholder salaries to market rates and the elimination of true one-off costs.

Care needs to be taken when adding back depreciation. If there is a significant cash cost to a business of replacing its assets annually, a buyer will factor this cost into its assessment of maintainable earnings if adding-back depreciation.

The terms ‘Adjusted EBITDA’ (earnings before interest, tax, depreciation and amortisation) and ‘Historical EBITDA’ are often used interchangeably with Maintainable Earnings. I much prefer the latter as it’s a better reflection of the numbers and the story behind them, and is not laden with reference to the past.  

4 – You Can’t Add the Value of Company Assets to the Valuation
If assets are truly ‘surplus’ to the company’s operations then perhaps they can be added to the valuation, but if they are fundamental to the company’s ability to generate its earnings, adding them to the valuation would be double counting. As would be attaching a value to ‘goodwill’. Buyers tend not to be too fond of this!

The most common ‘surplus asset’ we deal with in the UK is what we refer to as ‘free cash’, the opposite of which is debt. It’s much easier for clients to understand why ‘free cash’ can be added to the valuation than it is for them to understand why ‘debt’ needs to be deducted. There are a couple of easy ways to explain to clients in the article itself.

5 – Complex Deal Structures Can Cloud Valuations
A buyer can make what looks to be a great offer but understanding how the deal is structured - when and how the money is paid – makes all the difference.

The most common types of ‘structure’ in the UK are vendor loan (or defcon, where some of the consideration is paid over time), earn-out (where future payments are made depending on performance) and retained shareholdings (where the seller might keep a stake in the company or in its new owner).

‘Structure’ is generally used to bridge the gap between seller and buyer views of valuation and a buyer’s ability to fund a deal. It’s rare to see offers for companies that don’t include at least some element of structure, so issues such as buyer credit status, interest and security are key.

6 - Beware Valuations Based on Net Asset Value (NAV)
On rare occasions, particularly with companies where expensive assets are fundamental to their operations, the value of the company’s ‘net assets’ in the accounts is higher than a fair valuation derived using the normal formula. This can create an illusion of higher valuation for some clients, especially when some experts produce articles listing three, four or more ways of valuing a company.

This does not mean sellers can find the valuation basis that gives the highest valuation and expect to be able to market their company on that basis. Whatever the size of a company’s overall net assets value, its market value will almost always be more closely linked to earnings and cash flow than the size of its balance sheet. That’s not to say we don’t do deals based on net asset valuations plus ‘something for goodwill’, but they are rare.

7 – Clients Often Know Enough Already
Sellers will normally know enough about their own company to make an informed assessment of how their company might be valued in their market, so advisers should hone-in on these instincts.

Any questions, please read the full article here.

Author
Nick Hulme
Managing Director
Benchmark International

T: +44 (0) 161 359 4400
E: Hulme@benchmarkintl.com

Members from Benchmark International completed a Memory Walk last weekend to support the work done by the Alzheimer’s Society.

Memory Walks are held throughout the year around the UK to fund vital research conducted by the Alzheimer’s Society into the cause, care, cure and prevention of dementia.

Its ambitions are: “To reach every person who has a diagnosis and wants our help; to change the conversation on dementia and mainstream the rights of those affected by it; and drive the research agenda – working tirelessly to improve support today and unlock the answers for a cure tomorrow.”

Benchmark International is delighted to announce that it has been named by SME News as ‘Best for Acquisition, Growth & Exit Strategies 2018’ in its UK Enterprise Awards.

Part of AI Global Media, the international provider of corporate news and information, SME News produces quarterly publications with the latest news, features and deals across the UK SME landscape.

Alongside our success on behalf of clients, Benchmark International is immensely proud to announce that Roger Forshaw, Associate Director, has won the ‘Rising Star’ award at the annual JCI Manchester Young Talent Awards.