RG Corporate Finance (RGCF) has experienced the busiest August in its ten-year history having advised on seven significant management buy outs (MBOs) and strategic trade acquisitions.
The month of August is normally considered one of the quietest in the business calendar, but this year the peak holiday month witnessed a surge in business growth activity in the North East and Yorkshire.
The major deals RGCF advised on during August were:
- The management buy out of Komatsu Mining UK’s conveyor manufacturing operation in Sunderland, to create SE-TEK Ltd, which continues to operate from a 200,000 sq. ft manufacturing facility in Sunderland.
- The acquisition by North-East ed-tech specialist eQuality Solutions Group (eQS) of London-based Equality Works Group, putting the business firmly on track to achieve its £20m turnover target by 2023.
- The founders of Clear Edge Search & Selection completed a management buy out of the Leeds-based Fast Moving Consumer Goods (FMCG), igaming and technology sectors specialist staffing business – having acquired the shareholding of corporate shareholder CSG to own 100% of the company.
- North Yorkshire managed IT services provider razorblue expanded further into Scotland with the acquisition of sarn technologies. Now with eight offices and teams across the UK, the acquisition forms part of its strategy to become the most trusted managed IT service provider in the SME marketplace.
- Garbutt + Elliott Wealth Management, which has offices in York and Leeds, completed the acquisition of Yorkshire wealth management firm HKA (FS) Ltd.
- The other two undisclosed transactions both involved management buy outs involving North-East companies in the manufacturing and human capital sectors.
Carl Swansbury, RGCF’s head of corporate finance, said: “This increase in M&A activity took place during what is normally one of the quieter ‘holiday’ months of the business calendar.
“It’s partly due to the huge amount of liquidity in the market, further heightened following Brexit, as some corporate entities seek to dispose of their UK assets.
“However, there is no doubt that Covid-19 is also having an effect, spurring the entrepreneurial drive of shareholders and management teams to get ahead of the usual business cycle by completing deals as quickly as possible, whilst allowing sellers the opportunity to lock in current Capital Gains Tax rates given the possibility of increases that may be anticipated in the spring of 2022.
“All of these transactions have involved RGCF advising management teams on buy outs together with certain of our clients who are looking to make strategic acquisitions with the aim of growing their businesses by entering new markets, expanding into new geographies, or simply taking more market share.
“The focus of the clients we have advised over recent weeks is firmly on expansion and investment rather than disposal, which is encouraging for the region’s economic outlook.
“The market remains a fertile one for MBOs and M&A activity more generally. RGCF believes this is a trend that is set to continue and is already preparing for a very busy end to 2021.”
The Newcastle-headquartered CF boutique is not only the largest full-service CF advisory firm in the region, with a headcount of 19, but is also one of the most active, advising clients on company acquisitions, disposals, MBOs and Management Buy Ins (MBIs).
The award-winning corporate finance boutique also carries out company-wide strategic reviews with the aim of improving shareholder value, assists clients in raising growth and development capital, conducts business valuations and advises on growth strategies as well as providing transactional tax advice and performing financial due diligence on behalf of acquirers, funders, and management teams.
Carl added: “In many of the transactions we advised on in August, RGCF acted as CF lead advisor, whilst also providing transactional tax advice and financial and tax due diligence – demonstrating our breadth of expertise and knowledge.”