acquisition – David Bailey

26 May 2022

Riskcare acquired by BIP Group

Completing just before Easter and following client and internal employee communications, the acquisition of Riskcare by Italian-headquartered BIP Group has recently been made public. I was pleased to be advising Riskcare on this occasion.

Backed by CVC Capital Partners, BIP is an increasingly influential advisory firm in Europe and the Americas. The group acquired Chaucer Group in the UK and USA in 2020 which sent out a powerful message to the market about its forward ambitions.

I had known Steve White at Riskcare for 6-7 years and had followed an MBO journey from the sidelines. When Steve spoke to me mid-last year about his forward ambitions for the firm, I was ready and waiting to assist as Riskcare had built up an enviable client list in the capital markets and was in demand to both deliver more to them and expand out to selected others in the sector which it was looking to do carefully.

Being acquired by an organisation with broader capability was quickly identified as the route to go down. We researched potential acquirers that would be able to fit with the growth ambition whilst understanding the need to respect the critical existing client footprint. In BIP, we found a solution that is able to add technical resources to Riskcare’s expert Fintech capability alongside programme and change management strength in London and New York in particular.

There’s much to like here – client feedback about the deal is extremely positive, employees have more space within which to expand and both brands are enhanced. I look forward to following the forward success that will result.

See here for BIP Group’s press release.

11 August 2021

Bishopsgate Financial acquired by CubeMatch

The acquisition of Bishopsgate Financial by CubeMatch was announced late last month – an excellent deal for both firms. I was delighted to be advising Bishopsgate.

Mike Hampson, CEO of Bishopsgate, and I had known each other for a number of years but we hadn’t done any business together. Mike contacted me towards the end of 2020 and talked about wanting to merge with another firm to enable him to both take a wider set of services to Bishopsgate’s global banking clients and enable Bishopsgate’s expertise to reach a larger range of clients. An important part of any tie up would also be for Mike to join with an existing executive team to drive the combined business forward.

We approached a selected group of organisations in January and soon found ourselves in a number of interesting conversations. Bishopsgate, and Mike as its leader, are well known in the market and so discussions quickly moved to exploring the benefits of the various options that we had.

In CubeMatch, Mike saw that he could achieve his objectives. Headquartered in Ireland, and with offices elsewhere, CubeMatch was keen to expand its London operation. Bishopsgate’s range of services and a client base that added to its existing portfolio was of great interest. The business case for both was clear – all we had to do then was the paperwork!

The combined business has a team of over 250 professionals supporting financial services clients globally and, with revenues of c. £25m and good profitability, it has a strong platform to build on. There will be much more to see from this business as it continues on its growth path.

See here for Bishopsgate’s press release.

15 January 2021

Chaucer Group acquires Medley Business Solutions

The acquisition of Medley Business Solutions by Chaucer Group was announced in mid-December – I was delighted to play a significant part in this transaction.

Chaucer has grown strongly over recent years and is now well established as a leading consultancy in people centric digital transformation in the UK and USA. Joining with PE-backed Bip Consulting in mid-2020 has given Chaucer the ability to expand faster through partnering with other BIP companies and investment in both organic and inorganic growth activities.

Founded in 1997, Medley has built an enviable reputation as a client-side IT and management consulting firm operating in UK Public Sector. Its experienced practitioners are at the heart of a number of highly successful IT transformation programmes in central government, criminal justice, government agencies and NDPBs.

Medley was looking for access to a wider skillset to enable it to provide additional value to its client base. Chaucer wanted to grow its existing Public Sector expertise by adding more senior IT capability and through acquisition of a team with an existing set of executive-level relationships and a solid book of business that it could merge in with its own.

The two firms already had some experience of each other through partnering activity on bids and client assignments – some additional focus was placed on this to prove that joining together would be beneficial to both firms. The business fit continued to look good and the cultural fit was very positive. Things took off and a deal was discussed, agreed and completed in great spirit and with a joint outlook on what the parties wanted to achieve individually and together in the coming years. Client feedback has been extremely positive and the combined team is looking forward to achieving even greater outcomes for all.

See here for Chaucer’s press release.

21 January 201912 January 2021

Virtrium joins Chaucer Group

The merger of Virtrium into Chaucer Consulting was announced recently – an important milestone for both firms.

My story here begins in the summer of 2016 when the Directors of CIO Advisory firm Virtrium asked me to assist them with their forward growth strategy. Virtrium had a good brand in the market and a wealth of satisfied, long-term clients so I was happy to take a look. We spent time understanding why clients came to Virtrium and what they were asking Virtrium to help with, and gained a wealth of information.

From this, we honed propositions into three groupings that follow the life cycle of CIOs’ key investment programmes, namely IT Strategy, IT Architecture and IT Transformation – and with these being focused in on the Digital or Omni-Channel agenda that many IT functions are needing to supplement their own teams with external expert assistance. Altering Marketing messages and sales collateral to suit, the team was able to explain better the core focus of Virtrium and how it could assist its clients.

The results have been rewarding – a similar level of “point solution” assignments but, crucially, a much larger demand for Virtrium to assist its clients across complete programmes, taking lead roles in implementation phases.

Moving the clock forward two years to last summer, the Virtrium Board felt that it would be able to support its clients more easily if it had access to a larger team of programme and change management resource, and recruiting these was both taking an inordinate amount of effort and taking too long. Accordingly, we went out into the market to talk to other consulting firms that come from a programme, project and change management background.

In Chaucer, not only did we find the necessary capability but also a wealth of business consulting skills to sit alongside Virtrium’s IT strength. Also, Chaucer was already heavily involved in the implementation of Digital Transformation programmes without necessarily having been involved in the earlier strategic definition activity – Virtrium therefore provides the Chaucer team with additional much needed expertise in IT Strategy and Architecture. A true “win win” or “2 + 2 = 5+” scenario.

It’s only been a month, and with the Christmas break within this too, but client feedback has been excellent and supportive with some programmes involving one “heritage firm” or the other being extended to include the expanded capability.

I’m delighted to have been involved across the journey so far and look forward to witnessing the next chapter – the continued growth that the combined business will undoubtedly enjoy going forward.

See here for Virtrium’s press release.

18 April 2017

Overseas acquirers are on the lookout!

At the time of writing, I’m looking at a foreign exchange website and seeing that £1 will buy around €1.18 or US$1.25, making our overseas summer holidays more expensive this year. Maybe stay at home and mix with the larger volume of inbound tourists?

Overseas businesses are seeing things more like US$1 will buy 80p or €1 will buy 84.7p, which is much more sterling than they’re used to – so, now that it’s clearer to them that the UK won’t cease to exist after Brexit and is even likely to prosper, they’re seeing the UK as a good investment prospect, as evidenced by recent announcements from Qatar, Nissan and Lidl.

The UK has always been a stepping stone for US businesses wanting to expand into Europe and vice versa. Outside of this, the English speaking world likes to set up a base in the UK and even list on the UK Stock Exchange, which has tended to provide a stable foundation to build upon. The weakness of the pound, which isn’t likely to change much any time soon, is contributing to an increased volume of such activity.

In our Professional Services and IT Services world, we’re seeing a similar picture and there is a number of UK-focused acquisition programmes led by overseas headquartered firms that I’m aware of. This activity in the market is pushing valuation multiples up a little but it doesn’t matter too much for the acquirer as the exchange rate is more than making up for this.

Does this mean that the time to package up your firm and sell it is now? Well, it depends. Initial search activity from overseas buyers may not necessarily be as well focused as it could be – “let’s go and research what’s available in the UK and see if there are some reasonably decent firms that we can pick up for an OK price!” – so you may get some initial inbound enquiries and/or interest if you hang up a “for sale” sign. It doesn’t take long beyond a first meeting, however, for an acquirer to focus in on the fundamentals of a firm, including:

– quality of work

– breadth and depth of capabilities

– a client base to leverage

– a decent revenue, gross margin and EBITDA profile

– a baseload of forward business.

I’m amused to see how some firms have been “respraying” themselves to look “hot” – e.g. process improvement consulting firms now displaying a Business Transformation message, IT advisory and project management firms jumping on the Digital bandwagon and some even trying to “double up” on Digital Transformation! If it’s a genuine change in direction for these firms, they’ve invested in the new positioning and have evidence (case studies, industry awards, a decent number of trained consultants etc) to back this up (Note: it’s normally a three or so year programme to change direction properly) then fine. A swift respray, however, is unlikely to work since these overseas acquirers aren’t desperate to buy – they’re taking a look and may buy if the search exercise uncovers something genuinely interesting. In my own activities on the acquirer side, it isn’t difficult to distinguish between the ends of the spectrum and “pure respray” firms are unlikely even to know that we’ve taken a brief look!

So the overseas acquirers are here for a reason, they’re investing but they’re not being silly!

16 March 201712 January 2021

BearingPoint’s acquisition of LCP Consulting

Appointed by BearingPoint to introduce appropriate consulting firms to them from my network, I was delighted to be in at the start of this acquisition activity.

BearingPoint is a significant player in mainland Europe, most notably in France and Germany, and is growing fast in the UK. Our aim was to find consulting firms in the UK that would provide greater local capability in supply chain and similar services and also fit well with the existing horizontal capability teams and vertical practices of BearingPoint elsewhere in Europe.

LCP Consulting is an award-winning consultancy and the team there is seriously strong. They needed a home where they could spread their wings and grow more quickly.

This tie up is a great example of “1+1=3” – both organisations bring things to the party that the other has been looking for. Culturally, they fit well too and it was evident even at the first meeting that the two firms could create something special.

Well, the deal is now done and well done to all! I look forward now to seeing the special things being delivered in the market and the BearingPoint brand gaining increasing recognition in the UK as a result.

See here for BearingPoint’s press release.