{"id":237,"date":"2017-04-18T06:10:22","date_gmt":"2017-04-18T06:10:22","guid":{"rendered":"http:\/\/davidbailey.consulting\/?p=237"},"modified":"2017-04-18T06:10:22","modified_gmt":"2017-04-18T06:10:22","slug":"overseas-acquirers-are-on-the-lookout","status":"publish","type":"post","link":"http:\/\/davidbailey.consulting\/index.php\/2017\/04\/18\/overseas-acquirers-are-on-the-lookout\/","title":{"rendered":"Overseas acquirers are on the lookout!"},"content":{"rendered":"

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At the time of writing, I\u2019m looking at a foreign exchange website and seeing that \u00a31 will buy around \u20ac1.18 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?<\/p>\n

Overseas businesses are seeing things more like US$1 will buy 80p or \u20ac1 will buy 84.7p, which is much more sterling than they\u2019re used to \u2013 so, now that it\u2019s clearer to them that the UK won\u2019t cease to exist after Brexit and is even likely to prosper, they\u2019re seeing the UK as a good investment prospect, as evidenced by recent announcements from Qatar, Nissan and Lidl.<\/p>\n

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\u2019t likely to change much any time soon, is contributing to an increased volume of such activity.<\/p>\n

In our Professional Services and IT Services world, we\u2019re seeing a similar picture and there is a number of UK-focused acquisition programmes led by overseas headquartered firms that I\u2019m aware of. This activity in the market is pushing valuation multiples up a little but it doesn\u2019t matter too much for the acquirer as the exchange rate is more than making up for this.<\/p>\n

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 \u2013 \u201clet\u2019s go and research what\u2019s available in the UK and see if there are some reasonably decent firms that we can pick up for an OK price!\u201d \u2013 so you may get some initial inbound enquiries and\/or interest if you hang up a \u201cfor sale\u201d sign. It doesn\u2019t take long beyond a first meeting, however, for an acquirer to focus in on the fundamentals of a firm, including:<\/p>\n

– quality of work<\/p>\n

– breadth and depth of capabilities<\/p>\n

– a client base to leverage<\/p>\n

– a decent revenue, gross margin and EBITDA profile<\/p>\n

– a baseload of forward business.<\/p>\n

I\u2019m amused to see how some firms have been \u201crespraying\u201d themselves to look “hot” \u2013 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 \u201cdouble up\u201d on Digital Transformation! If it\u2019s a genuine change in direction for these firms, they\u2019ve 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\u2019s 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\u2019t desperate to buy \u2013 they\u2019re taking a look and may buy if the search exercise uncovers something genuinely interesting. In my own activities on the acquirer side, it isn\u2019t difficult to distinguish between the ends of the spectrum and \u201cpure respray\u201d firms are unlikely even to know that we\u2019ve taken a brief look!<\/p>\n

So the overseas acquirers are here for a reason, they\u2019re investing but they\u2019re not being silly!<\/p>\n","protected":false},"excerpt":{"rendered":"

      At the time of writing, I\u2019m looking at a foreign exchange website and seeing that \u00a31 will buy around \u20ac1.18 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 … <\/p>\n

Continue reading “Overseas acquirers are on the lookout!”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[10,4],"tags":[37,20,22,34,17,28,12,16],"class_list":["post-237","post","type-post","status-publish","format-standard","hentry","category-industry-comment","category-strategy","tag-acquirer","tag-acquisition","tag-consulting","tag-it-services","tag-owner","tag-professional-services","tag-shareholder","tag-strategy"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p8uSW5-3P","_links":{"self":[{"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/posts\/237","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/comments?post=237"}],"version-history":[{"count":19,"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/posts\/237\/revisions"}],"predecessor-version":[{"id":256,"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/posts\/237\/revisions\/256"}],"wp:attachment":[{"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/media?parent=237"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/categories?post=237"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/davidbailey.consulting\/index.php\/wp-json\/wp\/v2\/tags?post=237"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}