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<p>THE MARK A BENCHMARK INTERNATIONAL PUBLICATION BENCHMARKCORPORATE.COM VOL. XIV ISSUE I EXCLUSIVE INTERNATIONAL M&A OPPORTUNITIES GROWTH & INNOVATION THROUGH ACQUISITION ENTREPRENEURS WHO FAILED BEFORE THEY SUCCEEDED RECORD 2016 FOR M&A LOWER MID-MARKET: THE JEWEL IN THE CROWN OF M&A FEATURED OPPORTUNITIES LOWER MID-MARKET: THE JEWEL IN THE CROWN OF M&A REASONS TO BE BE CHEERFUL WHERE NEXT FOR BENCHMARK INTERNATIONAL? DON’T GIVE UP SECTOR SNAPSHOTS: ENERGY 6 OIL & GAS 14 BIOTECHNOLOGY 34 IT & TECHNOLOGY 44 MANUFACTURING 64 COMPLETED DEALS 72 OFFICE LOCATIONS 74 AWARDS 78 DID YOU SELL YOUR ATTORNEY? FEATURED OPPORTUNITIES HIRING THE RIGHT M&A LAWYER GROWTH & INNOVATION THROUGH ACQUISITION AWARDS ROUND-UP FOR 2016 THE MARK P U B L I C A T I O N 4 40 16 32 54 8 18 52 66 FEATURED BESPOKE OPPORTUNITY 36 2 Welcome to another edition of THE MARK, Benchmark International’s publication that provides insight into key events in the M&A industry. 2016 was a year of significant transition in many areas, particularly in the political world - with Brexit on the cards and Donald Trump recently moving in to the White House, this was definitely the ‘Year of Change.’ Despite these upheavals, it was very much business as usual at Benchmark International as we posted yet another record breaking year, closing over 75 deals, internationally. As we settle into 2017, our unrelenting aim remains - as always - to help you achieve your exit, growth or acquisition strategy by connecting you with the right opportunity. Whether you are seeking a full or partial exit, a strategic growth partner or an acquisition opportunity, we hope you find this publication useful and we look forward to helping you realise your business objectives in the coming year and beyond. Thanks for reading. Michael Lawrie NOTE FROM THE CMO TEAM SPOTLIGHT MICHELLE RAHGOZAR // ASSOCIATE EMILY COGLEY // SENIOR ASSOCIATE CONTACT U.S. Headquarters: 4488 West Boy Scout Blvd. Tampa, FL 33607 +1 813 898 2350 US@BENCHMARKCORPORATE.COM U.K. Headquarters: 101 Park Drive, Milton Park Oxfordshire, OX14 4RY +44 (0) 1865 410 050 UK@BENCHMARKCORPORATE.COM THE MARK A BENCHMARK INTERNATIONAL PUBLICATION 58 38 VOL. XIV ISSUE I 3 BY: CARL SETTLE // ASSOCIATE DIRECTOR The last 12 months have seen a range of business trends, from the promising through to the exciting, as many different sectors and industries have experienced growth and increasing levels of M&A activity. This has been despite the relative uncertainty surrounding political decisions, from the Brexit vote through to elections in some of the world’s largest trading countries. What is certainly clear is the continued success and strength of M&A in the lower mid-market space. HISTORY AS A GUIDE Benchmark International draws on the knowledge of hugely experienced M&A experts who can bring a long-term view to the current market conditions. It can be easy to get distracted by passing conditions or major political events, but it is very important to look to long-term trends to guide thinking on the future prospects for any business. This brings us to lower-mid market M&A. THE JEWEL IN THE CROWN OF M&A T:+44 (0) 161 359 4421 E: SETTLE@BENCHMARKCORPORATE.COM LOWER MID-MARKET: 4 Within the M&A industry, there is a clear trend in the strength of lower mid-market deals and activity during periods of lower growth and uncertainty, not just at times when there is an obvious market strength and growth. This is a trend that has held true for many decades. STRENGTH IN NUMBERS There are many different reasons for the strength of lower mid-market deals. Firstly, the necessity of M&A activity is there for all to see. It stimulates growth, allowing businesses to access new funding to add new skills to break into new markets. With the huge number of these types of businesses, there will always be the appetite to develop and grow through M&A. Secondly, lower mid-market deals are also achievable in a way that headline grabbing mega deals are not. While the biggest names in a given industry may have to satisfy a whole host of regulatory and financial regulations, as well as maintaining the good will of investors and other stakeholders, these risks or hurdles are less pronounced for smaller, more agile businesses. Furthermore as the largest organisations are potentially put off from engaging in M&A activity with their peers, they may well retain an appetite to acquire or invest in businesses that are smaller than themselves. WHAT NEXT FOR LOWER MID-MARKET COMPANIES? Those business owners within this space, whatever the sector, should think clearly and positively about M&A prospects, whatever the wider economic circumstances. Putting off the important discussions and thinking about the near- and long-term plans for the business can mean missed opportunities. The cliché that “There’s never been a better time to sell your business” may not ring true for all sectors or industries, but for lower mid-market companies, we can definitively say: “There’s never a better time to start thinking about the future of your business and how M&A can fit into these plans.” Get in touch with our experienced team with any questions you have about lower mid-market M&A and how Benchmark International can help you. 5 The slump in oil prices has placed substantial pressure on the energy sector in recent years. This has not only caused energy companies’ current activities to suffer, but has also radically altered the way that these businesses will operate in the future. One seismic shock hitting the sector over the next four years is the $1T expected to be cut from Oil & Gas exploration. Such a significant drop will reduce reserve-replacement ratios, leaving companies to seek other ways to fulfil demand, such as acquisition. As a result, 2016 witnessed a pick-up in M&A within the energy sector, with deal announcements rising 78 per ENERGY M&A SECTOR SNAPSHOT BY: JACLYN RUSSELL // SENIOR ASSOCIATE T:+44 (0) 1865 410 054 E: RUSSELL@BENCHMARKCORPORATE.COM 6 cent Year on Year since Q1 of last year. Deal value in Q1 of 2016 totalled $76.8B – the sector’s best performing quarter since 2011. As a result, the energy sector was one of the year’s most active sectors for deal value, falling in just behind the technology and property sectors. ENERGY SECURITY AND THE FUTURE Economic headwinds approaching the energy sector have created complex situations across oil-producing nations. From the well-documented issues surrounding the Dakota Access Pipeline in the U.S., to political uncertainty regarding the U.K. Shale industry and OPEC’s attempts to achieve an oil price agreement, the current state of the sector suggests the clear need for innovative energy solutions. With this in mind, agile players can make the most of opportunities in the sector, particularly as assets remain relatively low in price. Such opportunities have tempted new private equity money into the North Sea Oil & Gas market. In early Q4 of last year, Siccar Point Energy, a private equity-backed Aberdeen exploration and pipelining company, pulled off a significant deal to acquire interests totalling $1B. This deal was rumoured to be the largest for the offshore energy sector since the drop in the price of crude oil, and further underlines the resurgence of the sector. KEY PLAYER IN THE SECTOR M&A activity in the sector is currently dominated by the mega-deals involving Shell-BG and GE-Baker Hughes. While Baker Hughes had to scrap its proposed deal with Halliburton in 2014 due to regulatory issues, Shell and BG are having to sell off various parts of their existing businesses to ensure the deal is rubber-stamped by authorities. Consequently, this has created opportunities for acquirers to make a move on the areas being offloaded by Shell and BG. The GE-Baker Hughes deal, expected to complete at some point this year, is facing similar implications and moves have already been made to offload certain areas in order to satisfy regulators. Baker Hughes has reduced its stake in North American fracking outfit BJ Services, with CSL Capital Management and Goldman Sachs’ West Street Energy Partners investing in the brand in a deal estimated to be worth $325M. Elsewhere, Australia’s largest oil and gas operator, Woodside Petroleum, saw significant M&A activity throughout 2016, both globally and across the Australian market. In July, Woodside agreed to a £350M deal for ConocoPhillips’ Senegalese interests, highlighting the continued appeal of exploration assets. More recently, the company acquired £250M worth of assets from BHP Billiton in Australia to further consolidate its dominance in this market. LOOKING AHEAD TO THIS YEAR Despite issues facing the energy sector as a whole, M&A activity is expected to continue at this accelerated pace throughout the year. Looking at wider issues, the industry will seek to solve the challenge of the long-term drop in the price of oil, and local markets’ such as the North Sea are expected to see an increase in deal volume as a result of the mega-deals in progress. 7 YOU JUST SOLD YOUR BUSINESS, DID YOU SELL YOUR ATTORNEY TOO? 8 Jay Campbell is the Partner in Charge of the Memphis office at Adams and Reese and focuses his practice on mergers, acquisitions and related financing transactions. Adams and Reese is a law firm with nearly 280 attorneys and advisors located in 15 markets throughout the southern United States and Washington, D.C. The firm regularly represents strategic and financial market participants in acquisitions, dispositions, equity and debt offerings, and financing transactions ranging from under $10 million to over $1 billion, with most deals between $20 million and $200 million. After years of work building your business, and months of negotiation, you’ve sold your life’s work to a new owner. Even better, you, your financial advisors and your attorneys structured the transaction as a stock sale so you have limited risks after closing. But, if a dispute arises with the buyer, are the communications between you and your attorney still confidential and subject to attorney-client privilege? On its face, the answer to the question seems obvious, the principle that communications between clients and attorneys are to be held confidential and not permitted to be submitted as evidence in dispute is fundamental tenet of law in the United States. We believe that open communication between attorneys and their clients is so important that except for circumstances where a life could be in danger or a waiver is received, attorneys may not divulge privileged communications to third parties and courts may not permit any such communications to be used as evidence at trial. Nevertheless, in recent cases, where parties were lax in structuring their transactions, courts have found that, in the process of selling their businesses, sellers have also sold their rights to confidential attorney-client communications to the buyer as well. In particular, Delaware courts, whose business decisions influence courts throughout the United States, have held that if a seller sells all of its rights and privileges in a business, it has also sold its rights to its pre-closing communications with the business’s attorney. This means that if the buyer and seller have a dispute after closing, the buyer might be able to force the business’s attorney, who is often the seller’s personal attorney, to turn over all of the communications between the seller and the attorney related to the transaction and then use those communications against the seller in court. Obviously, this could have a devastating impact on the seller’s position in the dispute. Not every state has taken this approach, but regardless of what state’s law will govern you transaction, it is prudent to take some simple steps to avoid this issue. These steps include the following: • Address communications with attorneys in the purchase agreement. Courts seek to enforce the intentions of the parties to contracts, so if you clearly state how you intend for privileged communications to be treated after closing, a court is most likely to enforce your intention. • Segregate your communications regarding the transaction. Do not intermingle your communications regarding the transaction with normal business communications. For example, you could open a separate email account using a non-company service to use solely for the transaction to ensure that you do not inadvertently transfer confidential communications to a buyer when you transfer control of company email servers. • Hire separate legal counsel to assist with the transaction. If a seller hires new, legal counsel who does not regularly provide legal advice to the business, then it will be clear that the communications with the attorney are not part of the business the seller is transferring. With some pre-transaction planning, sellers can ensure that they do not inadvertently sell their relationship with their attorney when they sell their business. BY: ATTORNEY JAY CAMPBELL E: JAY.CAMPBELL@ARLAW.COM W: ADAMANDREESE.COM 9 BREXIT MEAN FOR M&A? Earlier in the year, the much-anticipated EU referendum in the U.K. saw the nation vote to leave. Prolonged uncertainty in the run-up to the vote had its effects on businesses large and small, with some companies waiting to see the outcome of the vote before proceeding with significant plans. Now there is a level of clarity on the issue, even if the various terms of Brexit are yet to be ironed out, businesses have hit the ground running and we have seen a range of positive indicators when it comes to M&A. We conducted an industry survey of over 15,000 stakeholders, including trade acquirers from the U.K. and internationally, private equity firms, investors, high-net worth individuals and sell-side advisers, to gauge the appetite from them and their clients to acquire following the Brexit vote. The results confirmed that business confidence remains high, as a range of sectors and acquirers signalled their intention to continue M&A activity in the short- and medium-term. WHAT DOES BY: CHRIS FIELDING // SENIOR ASSOCIATE T: +44 (0) 161 359 4422 E: FIELDING@BENCHMARKCORPORATE.COM 10 DEALS AND DECISIONS Firstly, market confidence has remained, with a variety of sectors and industries showing confidence despite the result of the vote. Headline sectors for deal appetite include manufacturing & industrial, engineering, IT & telecoms, distribution & storage, and professional services & consultancy. An overwhelming majority (88%) of respondents are looking to acquire in the U.K., underlining the continued attractiveness of U.K. businesses, as the country moves into a new relationship with its European partners in the E.U. Our survey responses tally with the deals and activity already announced this year since the Brexit vote. From the headline-grabbing mega-deals such as ARM’s acquisition by Softbank, through to high levels of M&A in the British Fintech sector post-Brexit vote, there is a real sense that British businesses are still set for a strong future. This market confidence is not just seen in M&A activity, but in the planning for the future from businesses. Nissan’s announcement that they will continue to operate in the U.K., with the building of new models at their Teeside hub announced following the Leave vote, signals that large multinationals are convinced of the merits of U.K. economy. NEW OPPORTUNITIES While the terms of the Brexit deal are to be decided, it’s clear that businesses can look to new opportunities for trade with new markets. The U.K. Government has made concerted efforts to court Chinese and Indian investors, signalling the potential opportunities available as the U.K. economy changes as Brexit is completed. China and India are two of the world’s largest economies, with historic ties to India ensuring that businesses could be well positioned to take advantage of opportunities. This may signal a rise in inbound M&A, as investors from these two countries seek to build stronger ties ahead of trade deals once Brexit is completed. Also linked is the value of U.K. currency internationally – a lower pound may help stimulate exports in a way that could power significant expansion in U.K. manufacturing. DAILY TURBULENCE VS. LONG-TERM PLANNING As companies look to acquire, their long-term strategy planning will prompt them to identify milestones and objectives that are in line with their business activities. The impact of the clarity we now have on the Brexit result may mean businesses are more ready to engage in an acquisition process. In fact, our survey confirmed that over 85% of respondents are looking to acquire in the next six to 12 months; this is a clear indicator that long-term planning, which is the basis of any successful acquisition, has continued across business despite the uncertainty in the run-up to the Brexit referendum. Once again, it can be easy to pay too much attention to the daily storm surrounding the issue, often whipped up by media outlets and politicians engaged in all kinds of manoeuvres to keep the issue alive in the minds of consumers and voters but business decisions don’t rest on these short-term issues, focusing instead on long-term planning. It is, therefore, critical for business owners to develop growth or exit strategies well before they intend to action them. Talking to Benchmark International’s team of dedicated experts can help you secure the future prospects of your businesses, whichever course your business owning journey takes. 11 JAMES ROBINSON What made you choose this profession? Although studying History at University does not make for a usual path into business, there has always been a curiosity and interest of how the business world ticks. When an opportunity arose at Benchmark International, I jumped at the chance. How do you spend your free time? I’m a keen fitness enthusiast and having done two half marathons and the Three Peaks Challenge in 2016, I’m now looking for my next challenge. Who inspires you the most? My Dad has had a huge influence on my life. He has had to work hard for everything he has achieved and has a contagious positive outlook on life. If you won the lottery, what would you do? Easy. Start my own business (I’m keeping the business plan a secret for now)! What has been one of the biggest moments in your life? Considering I’m not great with heights, the 15,000-ft. sky dive in Queenstown, New Zealand was a big moment. However, to avoid getting into trouble, my answer must be when I first met the Mrs. Favourite childhood memory? Easter holidays spent at Flamingo Land in North Yorkshire. A theme-park and a zoo in one place – it was the ultimate kid’s playground! What are your top three qualities? 1. Diligence. I know nothing is achieved without hard work whilst also understanding the importance of the needs of others, whether clients or colleagues. 2. Ambition. I am constantly looking for ways to improve myself, both in my career and personally. 3. Patience. Setting realistic goals and tasks to follow each day. You know the story about Rome, right? What were you doing before joining Benchmark International? Having been at Benchmark International for 6 years I do need to cast my mind back somewhat. Immediately before working here, I had a short spell travelling the world following the completion of my History degree at Huddersfield University. I have achieved a great deal at Benchmark International so far and I’m looking forward to an exciting future. List five words to describe your character? Curious. Competitive. Ambitious. Attentive. Diligent. “Every accomplishment starts with a decision to try” T: +44 (0) 161 359 4415 E: ROBINSON@BENCHMARKCORPORATE.COM DIRECTOR SPOTLIGHT 12 CLI EN T T EST IM ON IAL WA TCH TH E LATE ST TESTIMON IALS O N O UR WEBSI TEWW W.B ENC HM ARK COR POR ATE .CO.UK/RE SUL TS/ CLI ENTCOM ME NTS GAR Y BLACK (PAR TNER) // FREEM AN FIS HER LLP “You work just as h ard fo r the la st few th ou sa nd p ou nd s a s you d o to put th e d ea l to gether in th e fi rst p lac e. I a m alw ays im pressed b y y our h ard work , k no wl ed ge an d p rof es sio nalism .” 13 There is something to be said about having a full tank of gas without emptying your wallet. Almost everyone has benefitted one way or another from low oil and gas prices. Having some extra cash in our pockets has allowed many to buy more groceries, splurge on a nice pair of running shoes and even incited the purchase of a ‘dream car.’ While the positive effects of low oil and gas prices had many around the world cheering, there were many that weren’t as excited. Industry professionals that focused on Oil & Gas M&A deals saw the deals fall apart in front of them or their value drastically reduced. At one point, it seemed like there was not end in sight for the slowdown in M&A activity in this sector. As the new year came around so came the promise of increased activity in the field. The last quarter of 2016 saw the price of oil steadily increase and it appears that there is light at the end of the tunnel. The 2014 oil bust took the industry by surprise and the M&A market in this sector was no exception with major deals being placed on hold for the foreseeable future. However, during the last quarter of 2016 activity in the Oil & Gas market heated- up. According to Dealogic, the first two weeks of November, saw oil and gas deal-making hit $56.7 billion compared to $26.8 billion in the same period of 2015. Most of the deals have been led by new exploration and production. As a matter of fact, many of the deals in this sector have been made because sellers needed cash to pay down debt. Recently, Oil & Gas prices have steadily recovered and the prospects for the industry look promising. BY: LUIS VINALS // SENIOR ASSOCIATE T: +1 (512) 347-2000 E: VINALS@BENCHMARKCORPORATE.COM 14 INDUSTRY SNAPSHOT: OIL & GAS In order to make up for lost time, many industry players are aggressively chasing deals, which is typical in industries that experience boom-bust cycles. Now that financial institutions feel more comfortable providing capital, buyers are starting to chase projects at higher than average multiples. This trend is highlighted for deals occurring in the Permian Basin where the recovery is significantly stronger than in other regions because of lower production costs. PLS, Inc. notes that in 2016 The Permian Basin has seen the most deal making, with more than $23 billion in merger and acquisitions deals. Benchmark International anticipates 2017 to be the year of opportunity for Oil & Gas M&A. Many sellers are open to the possibility of exiting the market to pursue retirement and others are open to working alongside a buyer in order to position themselves for the upside of the cycle. With the market poised to see an increase in activity, it is only natural to expect healthy multiples on sales of Oil and Gas businesses. For sellers, now would be the time to look at their business and evaluate the benefits of low-cost debt and higher margins, among others. On the other hand, buyers will benefit from having an experienced team diligently working on their behalf to meet growth objectives. Benchmark International’s regional Texas office has vast experience in Oil and Gas deal making; reporting major increases in activity throughout West Texas and a renewed interest in the Houston Oil & Gas market. Now will be the time to contact a Benchmark International expert to get more information on Oil & Gas deals that cover the entire industry scope of Downstream, Midstream & Upstream. In conclusion, Benchmark International anticipates that 2017 will be year that Oil & Gas deals return to the closing table. 15 NEED SECTOR SPECIFIC INSIGHTS? UNLOCK THE BENCHMARK VAULT TODAY. We’ve compiled all the latest information on Healthcare, Industrial, Technology, Media & Telecoms, Distribution, and, Business Services into one location. Visit www.TheBenchmarkVault.com/sectors/ for more in-depth analysis on deals, opportunities industry insights for each sector and unlock your potential today. 16 WHERE NEXT FOR BENCHMARK INTERNATIONAL? 2016 was a record-breaking year for the business, with strong growth in the U.S. and U.K. in terms of deal value and deal volume. Earlier last year we broke the 50 deal mark and witnessed a significant increase on 2015’s results, while our CEO Greg Jackson received a “CEO of the Year” award from AI Global Media. We are delighted with the progress we made in 2016 but as a company, we won’t stand still and will continue to implement our ambitious growth strategy to sell great businesses. As deal volumes and deal values increase, we are developing our teams to support our clients in better ways than ever before. We take a look at some of the new developments at Benchmark International which will allow us to deliver our goals for the next 12 months. MAJOR TRANSACTIONS This is an area where we are delivering significant improvement in the U.S. We are posting ever higher numbers of transactions which fall into this category, with our activities led by CEO Greg Jackson. While major transactions in the U.S. is a competitive environment, there is a real opportunity to grow our activities in this space. In particular, we have secured a number of industry awards off the back of our performance in this space, with our peers and industry and trade publications recognising our achievements. TECHNOLOGY A relatively new cliché, “All businesses are technology businesses” highlights the impact of technology on businesses in the 21st century. While it is worth taking this concept with a pinch of salt, it is important that businesses understand the implications that technology can have. Benchmark International is continually investing in proprietary technology to support our strategy. It allows us to make our processes work much harder, throughout the lifecycle of a transaction, from the beginnings of engagement with a client through to post-deal activities. We will have some very exciting developments in this space throughout the year and look forward to delivering great results for clients. BRANCHING OUT Our aim at Benchmark International is to work with strong businesses, rather than limit ourselves to particular sectors or industries. Our business intelligence, built on our analysts and hugely experienced teams, allow us to very quickly evaluate the companies we come into contact with. However, there are clearly some very interesting areas where we are looking to grow our activities. Recruitment really was a vibrant sector in 2016 and this will continue into 2017. The U.K. has arguably the most advanced and innovative recruitment sector, ensuring that businesses in this market will remain in high demand for years to come. Conversely, outbound M&A will give these businesses a chance to take their market-leading services into new countries to really accelerate growth and grab market-share from incumbents. BY: PAUL WILSON // DIRECTOR T: +44 (0) 1865 410 055 E: WILSON@BENCHMARKCORPORATE.COM 17 A leading primary processor and supplier of fresh and re-freshed fish to both UK and international markets. The company holds key relationships with several UK high-street supermarkets in addition to a number of western European equivalents via a continental distributor. Now offering a growing range of own-branded fish products, these include whole, filleted and value added items, including the UK’s first processor provided microwaveable products. The company’s 35,000ft2 premises and extensive in-house processing infrastructure, enabling just-in-time supply, is primed to increase turnover by up to 50%. LOCATION: NORTH EAST ENGLAND SECTOR: FOOD PROCESSING Processor & Supplier of Fish – MAN1309 Well established and highly skilled telecoms engineers specialising in the installation of underground and overhead cabling, jointing and splicing for both copper and fibre optic systems. The company carries a strong reputation nationwide for its highly skilled engineers who deliver an excellent service. The excellent service levels are facilitated by the company’s in-house training school which allows the company to maintain quality control and scalability. The shareholders have identified the benefits of diversifying their service offering to provide a full turnkey operation which would allow the company to expand by providing solutions directly to the leading communications company. An established second tier management team is already in place and is willing to remain post completion. The majority shareholder is prepared to consider a range of structures post-sale that would provide them with new funds, resources and expertise to exploit the opportunities that are presently available. LOCATION: SOUTH ENGLAND, UK SECTOR: IT & TELECOMS Highly Profitable Telecoms Engineering Company with a Focus on Fibre Optic Cabling – ENG439 REVENUE: $13.1M ADJ. EBITDA: $2.5M REVENUE: £11M ADJ. EBITDA: £2.2M 18 REVENUE: £46.7M ADJ. EBITDA: £1.9M A full-service provider of hydraulic components and repairs with five retail locations. For over 30 years, the company has been catering to high-profit retail customers and a competitive OEM market comprised of resellers and fleet customers. It has a proven retail, distribution, and service model that has been replicated five times to service their 8,000 active accounts. The average combined gross profit margin is 31% over the last five years. They have a differentiated offering as services (repair, reseal, and replacement) that are done onsite at in-house fabrication shops. Management estimates the revenue breakdown is parts 80% / services 20%. The company operates from five locations ranging from 5,000 sq. ft. to 14,000 sq. ft. facilities that are leased from an affiliated entity. The owners will entertain selling the real estate or entering into long-term leases. There are three owners total, two of which are looking to exit for retirement, and one is open to remain. LOCATION: SOUTHEAST, US SECTOR: RETAIL Hydraulic Supply and Service Retailer with Five Locations – RET1041 Featured OpportunitiesU.K. Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM 19 Designs, develops, and manufactures early warning fire alarm systems, gas detection, and emergency systems for commercial and industrial applications. All products are designed and assembled in the UK, with manufacturing conducted in China, and distributed to clients in the UK, Europe, Africa, the Middle East, and Southern Asia. The majority of the products are exclusive to the company with all certifications/accreditations and the rights to all IP held by the company. Products adhere to EU legislation and the company has applied for an Underwriters Laboratories accreditation which could give it access to both the Northern and Southern American markets. The company has an entirely autonomous staff structure, with highly skilled employees and experienced 2nd tier management. This opportunity represents an excellent market entry opportunity for a manufacturer of fire alarm systems - a manufacturer could possibly bring all manufacturing in-house, limiting reliance on suppliers in China, and enhancing margins. LOCATION: WALES SECTOR: FIRE/SAFETY/ALARM SYSTEMS Manufacturer of Fire Alarm Systems, Gas Detection & Emergency Systems – SEC354 REVENUE: £13.6M ADJ. EBITDA: £2.7M The Texas-based IT staffing firm provides contract, contract-to-hire, and direct hire placement services to technical professionals in a number of industries including transportation, IT, food, financial, healthcare, and government. The company is proud to have longstanding relationships with Fortune 500 companies and has a proprietary database of over 100,000 IT candidates. The company leases 4,200 square feet of office space from an unrelated third party in the Dallas area. It also leases a smaller satellite office outside of Dallas from an unrelated third party. LOCATION: TEXAS, US SECTOR: BUSINESS SERVICES IT Recruiter with Two Locations in Texas – PRO1367 REVENUE: $11.5M ADJ. EBITDA: $1.3M U.K. HEADQUARTERS: 101 Park Drive Milton Park Oxfordshire, OX14 4RY +44 (0) 1865 410 050 UK@BENCHMARKCORPORATE.COM U.S. HEADQUARTERS: 4488 West Boy Scout Blvd. Suite 400 Tampa, FL 33607 +1 813 898 2350 US@BENCHMARKCORPORATE.COM Take our hand... U.S. Listings: Call +1 813 898 2350 or email STAFFORD@BENCHMARKCORPORATE.COM The company specialises in the design and installation of professional and technical working environments, specialising in data centres, server rooms and telecom facilities to blue-chip corporations, boasting a preferred supplier status to Siemens, Vodafone and Apetito. The technical design, installation and maintenance of data centre and server rooms totals 72% of the company’s turnover, with office design and installation totalling 28% of turnover. Staff are highly skilled and technical and a strong second tier management team is in place. Of the three shareholders, one is looking to remain with the business long-term, one is happy to remain is his current position for up to three years, and the final shareholder will exit post-completion. The company operates from two leasehold premises consisting of 8,500sqft of light industrial and office units located on a modern commercial estate in Southern England with ample capacity to accommodate growth and also providing rental income from sub-let. LOCATION: SOUTH WEST ENGLAND SECTOR: BUILDING & CONSTRUCTION Technical Interior Design & Fit-out Specialist for Data room & Telecom Facilities for Blue-chip Corporations – BUI410 REVENUE: £8.5M ADJ. EBITDA: £1.1M The company has been delivering engineering-driven telecommunications services to an array of industries for over 25 years. The majority of work completed in 2015 encompassed permitting/ field engineering/ small cell design, construction, testing and evaluation projects (46%). Distributed Antenna Systems (DAS) network construction and testing accounted for 40% of revenue, and the balance was related to structure cabling and other health- care related installations. A debt-free company that has completed 78 miles and 113 nodes for small cell construction across the US with 75 miles and 124 nodes in progress. The CEO/ non-active owner is looking to retire immediately whereas the other three remaining owners, who are heavily involved in the success of the daily operations, are willing to remain post sale. LOCATION: SOUTHEAST US SECTOR: IT & TELECOMS National Installer of Wireless & Broadband Telecom Services - ITT1133 REVENUE: $25.6M ADJ. EBITDA: $5.2M 20 CONTACT BENCHMARK INTERNATIONAL TODAY. U.K. Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM A leading value-added wholesale distributor of rebar, structural steel, connecting hardware, and other building material. The company specialises in custom steel fabrication and is well known for having competitively priced, high-quality products, with the team in place to provide technical and product support. The company has a large, diverse customer base of over 200 contractors and is experiencing strong year-on-year revenue growth. Highlights of the company include low customer concentration with the top customer accounting for just 7% of total revenue, flexible capital structure with little long-term debt, highly trained staff with decades of metal fabrication experience and product knowledge, and an excellent reputation among customers for its industry expertise and high-quality products. LOCATION: FLORIDA SECTOR: BUILDING & CONSTRUCTION Value Added Distributor of Structural Steel & Building Materials – BUI1274 REVENUE: $24.4M ADJ. EBITDA: $3.5M One of the largest UK owned, environmentally sustainable storage cooker brands. The company designs, manufactures and supplies electric heat storage cookers to the high-end domestic marketplace. The company’s cookers fulfil both the roles of cooking and heating, maintaining warmth for 24 hours a day. The majority of the company’s revenue is generated through its 70+ dealership network alongside direct sales to members of the general public allowing the company to hold a 20% market share. A CO2 negative operation encompassing renewable technologies and environmental initiatives, allows the brand to increase its appeal with the target audience whilst reducing overheads. The opportunity to continue to reduce overheads related to assembly and to increase margins has already been identified by relocating assembly facilities and sourcing components overseas. The shareholders are seeking an exit in order to secure growth impetus and pursue lifestyle changes but are willing to offer a long term consultancy agreement subject to terms. LOCATION: UK SECTOR: MANUFACTURING Specialist Designer & Manufacturer of Electric Heat Storage Cookers – MAN1044 REVENUE: £7M ADJ. EBITDA: £2M Importer and wholesaler of furniture, predominantly oak, for the interior furnishings market, directly supplying standard and customised direct container loads of furniture to blue-chip customers. Selling c.600 containers per annum across more than 40 product lines, the company owns trademarks for four of these. Seven customers now operate stores dedicated to the company’s offering, with a growing ecommerce presence. Recently developed internal IT systems provide wholesalers with immediate access to ordering, specification and lead time information., whilst a flexible and loyal supply chain enables exclusive customization of products for clientele. State of the art showroom also available for freehold purchase. LOCATION: MIDLANDS SECTOR: WHOLESALE Importer & Wholesaler of Furniture – WHT437 REVENUE: £10.7M ADJ. EBITDA: £1.3M A cruise liner cabin refurbishment and marine grade furniture manufacturer/ supplier providing a turnkey service, with a strong presence in both the refurbishment and new building markets. Cabin refurbishment accounted for 67% of revenue in 2015, with the balance split evenly between turnkey public space and retailers of marine furniture. The company is an industry-leading player that has provided refurbishment services to over 40,000 cabins over the past two decades. Operating from a 3,000 sq. ft. facility in the US and a 40,000 sq. ft. facility in Europe, both facilities have available capacity for expansion and are leased from unrelated third parties. LOCATION: EUROPE & US SECTOR: MOTOR, TRANSPORT & MARINE Cabin Refurbishment for Major Cruise Liners - REY850 REVENUE: €24.3M ADJ. EBITDA: €2.3M 21 U.S. Listings: Call +1 813 898 2350 or email STAFFORD@BENCHMARKCORPORATE.COM Subcontractor specialising in design and construction of concrete piling, retaining walls and ground works on behalf of commercial and domestic construction-based clients. The company offers a wide range of specialist drilling machinery for every ground type in a growing market resulting in an order book worth c£8m being compiled. Ideally placed to capitalise on projected construction and housebuilding increases in South East the shareholders have also identified the opportunity to benefit from the booming transport infrastructure (rail) sector. A strong second tier management team is currently in place and are willing to remain post completion to allow the current Shareholders to exit in order to pursue retirement and lifestyles changes. Both Shareholders will offer a consultancy period post completion in order to ensure a smooth handover. LOCATION: EAST ENGLAND SECTOR: ENGINEERING Subcontractor Specialising in Design & Construction of Concrete Piling – BUI1066 REVENUE: £5.7M ADJ. EBITDA: £987K The company is a designer, manufacturer and distributor of technically sophisticated gas cleaning and filtration products that are used primarily in air-pollution control, water pollution control and in the chemical processing industries. The company currently serves international chemical manufacturers and fertiliser producers. During recent official emission tests, reports have revealed that the company’s media has attained the best particulate removal ratings ever achieved. The company operates from two facilities which total 49,500 sq. ft. Both of these facilities are leased from a single unrelated third party under separate leases and there is capacity for further expansion within both premises Note: Revenue and Adj. EBITDA below is an average over 3 years. LOCATION: SOUTHEAST US SECTOR: MANUFACTURING & INDUSTRIAL Manufacturer of Industrial Cleaning & Filtration Devices - REN278 REVENUE: $14M ADJ. EBITDA: $1.4M Company providing tailored IT project, programme and portfolio management services to blue chip clients operating across multiple sectors, including legal, aviation, telecommunications, higher education with potential to expand beyond. The company was established in 2008 to solve the poor project management capability and the lack of managed project services available on the market. With this in mind, it was created with a vision to provide a high quality, customer focused projects that deliver predictable, repeatable and cost effective business outcomes for clients. All consultants are extensively experienced in their respective fields and are able to provide clients with a complete turnkey solution with in depth knowledge of the aviation and legal sectors, having operated in these sectors for many years in which their client base includes a major UK airport and a Magic Circle law firm. In addition to this, the company’s geographic reach has been extended with successful projects being delivered across the USA, Middle East and Asia. The current owners are seeking impetus to take the company to the next level, and are both ready and willing to support the delivery of the business plan for the new owner. LOCATION: SOUTH ENGLAND, UK SECTOR: IT & TELECOMS Specialist IT Project Management Consultancy to Blue-chip Clients - ITT097 REVENUE: £6.4M ADJ. EBITDA: £1.4M Data driven sales organization specializing in exterior home improvement offering specialty windows, siding, roofing and doors. With 54 years in business, the company has an outstanding reputation in the market. They operate with a proprietary CRM database that contains historical customer data of date, location, job specifications, salesmen, client, revenue, etc. The database contains over 20 years of client information. The projects are 98% residential, and 100% non-new construction with 50% of customers that engage in repeat business. The company operates from two facilities, a 10,000 sq. ft. building which is utilized as an office/showroom/warehouse, and a 4,500 sq. ft. facility used for warehousing. These premises are leased from the company’s owner. There are six owners, one of which is active in the company and serves as President. They are seeking to sell the company in order to allow the active owner to pursue retirement. The president is available to stay with the company for a transition period to ensure the company’s continued success. LOCATION: SOUTHEAST, US SECTOR: BUILDING & CONSTRUCTION Exterior Residential Remodeler- BUI1464 REVENUE: $14.4M ADJ. EBITDA: $2.5M 22 U.K. Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM A turn-key concrete contractor providing flatwork, tilt-up construction, foundations, and exterior paving. The company has been working in the concrete space for over 30 years and has developed long- term relationships with leading contractors. The company has a $10.3M order book as of September 30, 2016, and a succession plan in place, with a seasoned management team to run the day-to-day operations. Highlights of the company include placing several million square feet of concrete floors and tilt wall panels annually, long-term relationships with leading contractors, resulting in significant repeat business, and a specialisation in large-scale, heavy industrial and commercial projects. LOCATION: NORTH CAROLINA SECTOR: BUILDING & CONSTRUCTION Leading Concrete Contractor – BUI1496 REVENUE: $17.8M ADJ. EBITDA: $2.6M A leading training and employment agency specialising in the provision of apprenticeships, work-based learning, and job focused employability programmes, operating as two prime contractors. The Group encompasses two companies operating as prime contractors for the Skills Funding Agency (SFA), with secured contracts valued at £7M, and additional contractual growth of c£2.5M achieved in 2016. The company concentrates its service delivery across England with a strong Northern presence including dedicated training centres, alongside a network of subcontracted service delivery associates operating across the UK. Revenue is secured predominantly via apprenticeship, traineeship and advanced learner loan funding from the Skills Funding Agency (SFA), alongside individual learners, direct employers, colleges and government bodies and, increasingly, commercial sources. The Group also maintains excellent national relationships with job centres and local authorities for candidate generation, and developed corporate social responsibility. LOCATION: UK SECTOR: RECRUITMENT & TRAINING Highly Experienced Training & Employment Agency - REC907 REVENUE: £6.4M ADJ. EBITDA: £876K Principal activity is the provision of ICT resources & services, comprising online tools and on-site personnel, to educational establishments allowing the company to manage, develop, and support an establishments’ technology needs. The company offers a cradle to grave approach from design through to implementation and commissioning of IT solutions such as managed services, as well as the provision of end-user training. The company currently holds an impressive client base of schools which includes prestigious, world- renowned institutions as well as over 60 service contracts with c75% being over 3 years in length resulting in low customer concentration levels. The shareholders have already identified an excellent opportunity for the company to continue its expansion into the education sector, particularly with independent schools and colleges in the South East, as well as other regions of the UK. The shareholders are seeking an exit due to not having the appropriate resources to exploit opportunities that are currently present in the market but are willing to consider a range of structures in order to facilitate this. LOCATION: SOUTH ENGLAND, UK SECTOR: IT & TELECOMS Specialist ICT Solutions Provider to Educational Establishments – ITT1121 REVENUE: £5.6M ADJ. EBITDA: £1M The company provides project management, facility support, and janitorial, consulting and advisory services to federal, state, and local governments. The company has successfully completed 37 long-term contracts since inception and currently has four multiyear government contracts in place worth $58.8M. Highlights of the company include monthly recurring revenue streams from long-term government contracts, significant year- on-year revenue growth; rates ranging from 18% to 41% for the period 31/12/2011 through 31/12/2015, high bid success rate due to long-term relationships with several government agencies, experienced, on-site project managers responsible for the day- to-day operations, and a strong employee base of over 300, allowing the company to target large-scale projects and ramp-up operations quickly. LOCATION: FULTON COUNTY, GA SECTOR: PROFESSIONAL SERVICES Facility Support & Janitorial Services Provider for Government Entities – PRO1315 REVENUE: $18.9M ADJ. EBITDA: $1.6M 23 U.S. Listings: Call +1 813 898 2350 or email STAFFORD@BENCHMARKCORPORATE.COM Each company within the group, utilising their own in-house team, offers a nationwide supply and installation service to clients operating in a diverse range of sectors within the commercial, leisure, transport and energy industries. The company offers a high standard of service which has been evident from the high level customer retention (circa. 60%). The company boasts a second tier management team willing to remain in place, who are well qualified, hugely experienced and able to fulfil the role of the outgoing shareholders post-sale. Operating from the company’s own, 50,000sq. ft. premises, the company has ample capacity to continue its growth curve, and is well equipped with modern spec machinery and software, owing to its many quality management certifications including ISO9001, Eurosafe status and CE marks for steel/aluminium works. LOCATION: NORTH EAST ENGLAND, UK SECTOR: MANUFACTURING Group of Companies Specialising in a Diverse Range of Services Including Corporate Signage, Graphics, Bespoke Fabrication & Interior Fit-Out – ENG456. REVENUE: £5.3M ADJ. EBITDA: £1M The Texas-based firm provides Process Safety Management (PSM), software applications, and engineering consulting services for the oil, gas, and petrochemical industry. The firm’s software solutions track, monitor, verify, and sustain data that clients can use in the operation of the facilities in order to comply with OSHA, EPA, and other regulation requirements. The company has Top Fortune 500 clientele, which includes major oil & gas companies. In addition, the company also has its own proprietary software. The company leases three facilities in different areas of Texas from unrelated third parties. LOCATION: TEXAS SECTOR: Oil & Gas: PSM, Software Applications, and Engineer Consulting Service Provider – PRO1395 REVENUE: $10.8M ADJ. EBITDA: $2.1M 24 BENCHMARK INTERNATIONAL HAS THE GLOBAL REACH YOU NEED. U.K. Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM A laboratory that provides analytical services to the environmental, industrial hygiene, and microbiological industries. Possessing state of the art facilities, the laboratory is one of the most accredited in the industry, capable of providing a wide range of testing all at one location. Operating for over 25 years providing a one stop shop for all types of testing, the experienced, skilled employees and proprietary CRM system allows the company to provide a service that is unmatched in the industry. The shareholder is seeking a full sale but is open to remaining post sale, depending on the acquirer’s needs. The company captures less than 1% of the market share so there are opportunities to increase sales and marketing. There are opportunities to expand food, air, and oil and gas testing. The current facility has capacity to expand an additional 7,000 sq ft. LOCATION: SOUTHWEST, US SECTOR: PROFESSIONAL SERVICES Fully Accredited Testing Lab – VEN009 REVENUE: $6.1M ADJ. EBITDA: $1.1M Software developer providing software as a service to automate business processes across a range of sectors including healthcare, retail, government, manufacturing and hospitality. The company boasts a portfolio of c20 solutions installed in c200 organisations worldwide, with all software IPR owned, servicing blue-chip clients consisting of over 100 NHS trusts, public authorities and several high-street retail chains, both in the UK and internationally. Long- term contracts (3-5 years) provide c67% of sales, with a high-level of recurring income from product licences, support and hosting sales. There is huge potential for an acquirer to considerably expand its product portfolio and benefit from an established foothold in the healthcare sector. A strong second tier management team is in place and will remain with the company long term, post-sale. The shareholders are happy to provide a short-term handover period. LOCATION: SOUTH WEST ENGLAND SECTOR: SOFTWARE Market-Leading Software Developer Offering Business-Critical Software Solutions across a Number of Sectors – ITT1196 REVENUE: £5.2M ADJ. EBITDA: £1.2M Provider of professional IT solutions, such as cloud services, specialising in the sale of ‘best of breed’ hardware & software (the best hardware/software in its market niche or category), with a growing focus on IT support, maintenance, and security. The company achieved partner, gold partner & diamond partner status with a number of prestigious, high-end software and hardware suppliers, enabling the company to have access to over 100k products. The wide product selection means the company is not restricted in its product & service offering, which is all backed up by competitive pricing. Primary plans have been established to place all customers on 12 month rolling support and maintenance contracts to generate stable recurring revenue whilst secondary plans to expand into the development, installation, migration and integration of phone systems have also been put in place. The shareholders are looking to exit as they believe the company could benefit from an acquirer with enough expertise and resource to enable growth and maximise the opportunities within support, telecoms & cloud services that are currently not being explored. LOCATION: SOUTH ENGLAND, UK SECTOR: IT & TELECOMS Specialist Provider of IT Solutions & High Quality Hardware & Software – ITT1094 REVENUE: £5.5M ADJ. EBITDA: £464K Full service advertising and technology agency focusing exclusively in the Tier III automotive industry. It provides content creation, copy writing, video production, media placement, web content/creation, social media management services, pre-roll, search engine marketing (SEM), and search engine optimization (SEO). An internal proprietary job system software allows company to provide fast and reliable products to its diverse customer base. While operating in growth mode; revenues have grown from $3.7M in 2013 to $12.9M through YTD Sep. 30, 2016. Also has an extensive library of high- quality/award winning creative products along with an in-house programming department. The company is headquartered in a 11,000 sq. ft. facility leased from an affiliated entity, located on 4.5 acres in Florida. It also has 6,178 sq. ft. of office space in the western U.S. There are two active owners who have successfully tripled the company over the last three years. The current owners are looking for a financial partnership to help continue growing the business. Management believes the company has a two-year head start on the competition and with some financial backing, it can capture a larger share of the market before other companies catch up. LOCATION: FLORIDA SECTOR: IT & TELECOMS Full Service Advertising and Technology Agency for the Automotive Industry- ITT1290 25 REVENUE: $ 12.9M U.S. Listings: Call +1 813 898 2350 or email STAFFORD@BENCHMARKCORPORATE.COM Electronic security systems provider specialising in the design, supply, installation and service of CCTV systems, as well as access control and ANPR (Automatic Number Plate Recognition) systems. The company operates in multiple sectors including retail, leisure and transport, although predominantly in local governments, police forces and the NHS. Due to the company’s in-house knowledge of the public sector, the Manging Director has identified an opportunity across the UK and as a result has changed the business model to focus on local authorities and public forces. The company holds an excellent reputation in the security installation market and also holds service contracts with guaranteed revenues, secured by 3-5 year contracts, for maintenance and support work. The shareholders are willing to consider a range of structures that would provide them with new funds, resources and expertise to exploit all the opportunities that are presently available. LOCATION: SOUTH EAST ENGLAND, UK SECTOR: SECURITY Security Systems Provider, Specialising in CCTV, Access Control & ANPR Systems – SEC034 REVENUE: £4.2M ADJ. EBITDA: £1M Industry leading software and services provider for legacy image and data migration and conversions to the financial services industry. Through its flagship product, the company offers users a more efficient, secure and cost-effective means to migrate and/or convert legacy data from its original system. The company’s employees bring more than 20 years of experience in specialised data conversions and migrations which has led to long-term contracts in place with banks and credit unions nationwide that span three to seven years and automatically renew at the end of the term. Highlights of the company include over 300 individual contracts across the US and Guam, with no single client accounting for over 8% of total sales, the ability to convert more than 300 legacy image and data system formats to any output format utilising a user-friendly browser-based interface, and industry-leading software that migrates legacy data and images from almost any archive system in a much more efficient manner than traditional methods and allows for enterprise wide research, printing, and emailing. LOCATION: BIRMINGHAM, AL SECTOR: IT & TELECOMS Proven Industry-Leading Data Migration & Conversion Software – ITT1126 REVENUE: $2.6M ADJ. EBITDA: $1.5M A specialist residential company providing care and education to children aged between 8 & 18 who have suffered trauma and abuse, with a specialist focus on sexual abuse and sexually harmful behaviour. Education services are provided both to the young people in the company’s care, as well as day pupils to facilitate their return to mainstream education. Rated the number one provider of residential care and education in the National Framework for Scotland in April 2014 and continued to experience high rise in the number of referrals from local authorities. The company operates in a highly specialised area of the care industry, working with the top 5% of high-risk young people for which there are very limited alternative opportunities. It has access to all local authorities across Scotland plus increasing referrals from English local authorities. It provides educational services alongside specialised care services and has 3 HMIE registered schools with a combined total of 35 registered schools. The owners are exiting as they feel a larger organisation will have the necessary resources to take the business to the next level. LOCATION: SCOTLAND, UK SECTOR: CARE, HEALTH & MEDICAL Specialist Residential Company Providing Care & Education to Children - CAR1029 REVENUE: £5.1M ADJ. EBITDA: £795K Software developer with 30 years of trusted consulting expertise in its user-friendly, customisable technology. The company has a stable, monthly recurring revenue model in place with recurring revenue generated from maintenance and support. Products and services are specifically catered to life and annuity insurance companies with a blue chip customer base including Humana, Zurich, MassMutual and New York Life. This is a small, tightly-focused company with a virtual business model and a team that has extensive hands-on experience in all aspects of insurance operations and all major types of insurance products. The company operates from a 14,000 sq. ft. facility leased from an affiliated entity and there is room to grow in the current location as only c70% is occupied. LOCATION: ALABAMA, US SECTOR: PROFESSIONAL SERVICES Insurance Software Platform - PRO1153 26 REVENUE: $5.8M ADJ. EBITDA: $2.1M U.K. Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM A legal practice predominantly providing high volume, fixed-fee conveyancing, will writing & probate services, to a predominately private client base located throughout England and Wales. It operates in 10 different languages, currently covering 13 specialisms, with growing penetration of commercial and niche markets domestically. This is a margin focused business model, with profitability and expenditure assessed on per-employee basis. The shareholders advise that there is a growing potential market for commercial law services offered on a fixed-fee basis. With further investment in volume commercial legal services, the company could broaden its market coverage and the reputation of its client base. Unusually, the partners conduct no active casework, and have instilled autonomy into every department within the company, making this an attractive acquisition to both Private Equity, as well as practices looking to expand their service offering. LOCATION: SOUTH EAST ENGLAND SECTOR: LAW Legal Practice Providing High Volume Fixed Fee Services - PRO1080 REVENUE: £3.5M ADJ. EBITDA: £870K Serviced Office Company, providing long-term flexible, unbranded office space and short-term leases of virtual offices and meeting rooms. The majority of the company’s revenue is generated from the rental of high-margin floor space and the upscale of integrated contracted services such as IT and Telecoms, which provides an additional source of revenue. Encompasses 6 leased modern and unbranded business centres at prestigious addresses in major UK cities, each with a high quality fit-out. The company provides its outstanding customer service and accompanying service level agreements to a diverse array of tenants, operating in various market sectors, with blue-chip clients ranging from start-ups to regional divisions of multinational companies, each on a minimum three year contract. The company operates from a 12,500sqft leased head office in the Midlands, UK. The current shareholders are amenable to staying with the company post-sale for a two year handover, subject to terms. LOCATION: UK WIDE SECTOR: LAND & PROPERTY Serviced Office Provider with Blue-chip Client Base – MAN036 REVENUE: £3.4M ADJ. EBITDA: £1.2M Designs and builds low voltage electrical control systems, from standalone distribution panels to intelligent motor control centres, as well as manufacturing bespoke stainless steel equipment, primarily for road tunnel applications. The business holds a diverse client base operating across a wide range of industries including aggregates, agrichemicals, infrastructure, food and beverage, and pharmaceuticals. Our clients have identified the opportunity to develop a low cost, fixed pattern motor control centre, in conjunction with an approved partner, to expand the company’s market share. A well-established and respected company within the industry, having been in operation for over 30 years. Only one of the three shareholders is at retirement age and wishing to exit the business leaving an experienced Financial Director and Technical Director keen to remain in order to exploit the opportunities in the current market and take the company forward. LOCATION: EAST ENGLAND SECTOR: ENGINEERING Bespoke Electrical Control Panel Designer & Manufacturer – ENG172 REVENUE: £4.8M ADJ. EBITDA: £746K The company is a manufacturer of high quality, highly specialised diamond abrasive tools that serve the microelectronic, telecommunications, semiconductor, and consumer electronics industries. The company also offers cutting services and machine servicing to select customers. Highlights of the company include competitive lead times of only two to three weeks from the time an order is processed, free R&D services to current and new customers, consistent performance and product reliability within the industry, over 38 years of industry leading experience, an admirable reputation among global customers with an outstanding retention rate, and a confidential backlog of over $380K. LOCATION: SOUTHEAST US SECTOR: MANUFACTURING & INDUSTRIAL Manufacturer of High-Quality Diamond Tools for Precise Micro-Machining – MAN792 REVENUE: $5.4M ADJ. EBITDA: $2.9M 27 U.S. Listings: Call +1 813 898 2350 or email STAFFORD@BENCHMARKCORPORATE.COM The business has pioneered a leading edge digital tool to generate sales for world class clients. This is achieved by using powerful virtual/ visual experiences, to engage and captivate a potential customer, by allowing them to experience a product/ service/ property, via a tablet or web viewer. All work is created in house, by a highly skilled and experienced, autonomous workforce. Services have been created for blue-chip clients in several sectors with proven success. Sectors include automotive, property, medical, luxury boating, manufacturing, mobile telecommunications, environmental, airlines, finance, recruitment, charities, tourism, and publications. The shareholders are seeking a lifestyle exit after starting the company 17 years ago. Please see the demo link to view the potential of this emerging technology: www.mustard-design.co.uk/IMdemo LOCATION: EAST ENGLAND SECTOR: MEDIA & ADVERTISING Virtual 3D Marketing Software, Used Across a Number of Applications in a Variety of Sectors – ENG1039 REVENUE: £2.5M ADJ. EBITDA: £2M Family owned company providing CNC, fabrication, and traditional sheet metal services, including CNC laser cutting, as well as TIG and MIG welding services. It operates as a sub-contractor for a blue-chip client base across multiple sectors, including construction, retail, transport, and local authorities. The company has an enviable industry reputation established from providing diversified services via two distinct divisions - CNC and fabrication services. A full turnkey service is provided from design and production, to delivery of components & installation, if required by clients. To complement the new machinery, the company plans to upgrade its IT systems by installing new software which will link all the processes together, making its production quicker and easier. Shareholders advise an existing client could increase expenditure with the company by approx. 500% in the next financial year. Impressive management structure capable of operating autonomously with minimal involvement from the shareholders. LOCATION: YORKSHIRE, UK SECTOR: ENGINEERING Yorkshire’s Principal CNC, Fabrication, & Traditional Sheet Metal Provider – ENG040 28 REVENUE: £3.1M ADJ. EBITDA: £1.1M U.K. Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM FIND OUT TODAY BY CALLING BENCHMARK INTERNATIONAL /COMPANY/BENCHMARK-INTERNATIONAL @BENCHMARKGROUP /BENCHMARKCORPORATE 29 U.S. Listings: Call +1 813 898 2350 or email STAFFORD@BENCHMARKCORPORATE.COM Let’s stay connected. Follow us on social media. 30 31 RECORD 2016 FOR M&A AGAINST ALL ODDS Despite major political disruption from events such as Britain leaving the E.U. and the election of a new president of the United States, 2016 defied the odds and ended up being the biggest year for M&A deal announcements since 2007. Throughout the run-up to last year’s E.U. referendum and the U.S. election, M&A expectations were low for the remainder of the year. Historically, M&A activity slows in quarter three of a U.S. presidential election year, with dealmakers waiting to see what policies the new president might introduce. However, last year was an exception, which is all the more surprising given the controversial nature of the Trump and Clinton campaign, and especially following the unexpected result. In the U.K., the economic slowdown in the aftermath of Brexit fortunately did not materialise in the third quarter and the region went on to have one of its best performing years for early stage M&A activity. The U.K. has strong levels of asset disposals in other European countries such as France, Spain and Germany as well as the declining pound, making British companies a lot cheaper internationally, to thank for the eight per cent rise. To put this into perspective, the second quarter, which saw the lead up to the referendum, saw a decrease by one per cent. While Europe, the Middle East & Africa, Asia-Pacific and North America saw increases in early-stage M&A activity, up 13, nine and five per cent respectively, Latin America, Australia and Japan have posted declining early stage activity levels. This varying activity mainly comes down to the new industries of interest. For example, Australia is still struggling to find an alternative to the metals and mining sector. Across the world, the strongest sectors for early stage activity include energy & power, technology, real estate and media telecommunications, which have all increased by double-digit percentages. These emerging sectors coupled with the predicted increased activity means this year is gearing up to be another record-breaking year for global M&A. BY: SUNNY YANG GARTEN // SENIOR ASSOCIATE T: +1 (813) 898 2350 E: GARTEN@BENCHMARKCORPORATE.COM Allow me to slide the curtain open on a secret many lawyers would prefer to keep concealed. Passing the bar doesn’t qualify a lawyer to do all things legal. I have been licensed to practice law in Florida for nearly 30 years and have achieved the highest ratings for competency and ethics awarded by the best known legal ranking service, but you do not want me to write your will, handle your adoption, or chair your company’s litigation. In today’s legal environment, a lawyer need to be a specialist to be competent, but intense competition often forces many lawyers to try to be all things to all people. I have seen this issue arise in the context of helping a client sell a business. Unfortunately, not only does the lawyer not know what he doesn’t know, neither does the owner of the business. As an entrepreneurial business owner, you have spent a good portion of your working life creating something of great value to you, your employees, your customers, and prospective buyers looking to take your business to the next level. Now, when it is time for the most complicated and important transaction in which you and the business will ever be involved, you should not hand your life’s work to a lawyer who may be well-intentioned and enthusiastic, but is a novice at these types of deals. How are you supposed to make this decision? How do you know if the lawyer you have used for 20 years (or your brother- in-law who says he can handle it) can protect you from the risks that could reduce, or eliminate, the amount you ultimately net from the sale. I suggest that any lawyer wanting to represent you in the sale of the business be able to answer these four questions to your satisfaction: 1. How many business acquisitions have you done? Commercials for Farmer’s Insurance offer the catchy tag line, “We know a thing or two because we’ve seen a thing or two.” You want a lawyer who represents buyers and sellers in the sale of businesses as a regular part of their practice. In other words, corporate transactions is what they do, as opposed to being something they dabble in. Ask for references from sellers the lawyer has previously represented. On that note, in addition to quantity, the quality of the transactions is BY: DOUGLAS E. STARCHER // BROAD AND CASSEL T: +1 (407) 839-4200 E: DSTARCHER@BROADANDCASSEL.COM HIRING THE RIGHT M&A LAWYER FOR YOUR MOST IMPORTANT TRANSACTION 32 Photo by Erika Grace Photography important. Ask if the lawyer has worked on a deal where the buyer was a sophisticated private equity group, or a public company. These buyers are often the most intense and thorough, bringing out the widest range of complex issues and establishing what is “market”. Even if your buyer is not an equity fund out of Chicago or Boston, you want a lawyer who is experienced in the issues raised by those buyers. 2. Do you have a corporate/partnership tax lawyer (LLM degree in income tax) on staff and available to work on this deal? Every sale of a business invokes complicated and important tax considerations. Realize that the purchase price in your letter of intent is a top line number. What ends up in your pocket at the end of the day is a bottom line net number. Numerous issues affect the net number, not the least of which is taxes. Some of my most satisfying moments in the past two years have been working with the tax lawyers on my team to save our client millions in taxes by identifying an issue, pointing out the implications and restructuring an element of the deal that would have gone unnoticed (until tax time) without experienced tax counsel. Remember, the net amount you keep is more important than the gross amount in the agreement. 3. Does your team have the expertise and experience to handle disclosure schedules, real estate purchases and leases, labor issues, estate planning, intellectual property issues, and technology protection? The sale of your business may not need to involve all of these issues, but I guaranty it will involve one or more of them. Depth and breadth of expertise on the team is needed to avoid risk and maximize the net. If any lawyer claims he can handle all of these issues by himself, eliminate him from further consideration. 4. Can you tell me a little about indemnities, caps, baskets, limitations, and insurance? As a business seller, there will be 100 things you and your lawyer could fight about with the buyer. One benefit of experienced deal counsel is knowing what issues are important and what issues are not. If you fight about all 100, you will never sell your business. If you fight about none, you will probably have a result you will regret. In the game to determine how much of the gross price you get to keep, and how much the buyer gets to recover from you after closing, the most important playing field will be the area of indemnities. The buyer wants to put strings on the purchase price it pays you, so that if certain circumstances occur, the buyer pulls the string and gets money back. As counsel for the seller, we try to minimize the strings. It is a delicate dance that is never outlined in the term sheet and is usually negotiated toward the end of the deal, when the seller is emotionally and mentally drained. The outcome of this dance, however, could make all the difference to you. If your lawyer cannot explain the elements and his strategy for limiting indemnity exposure through the various items mentioned above, he may not be as experienced as he thinks he is and certainly not as experienced as you want. In addition to passing the threshold competency test by answering your questions, ultimately you must trust your deal counsel. Even though the sale of a business is by definition transactional in nature, I find fulfillment in representing sellers because it is so relational. I often describe my role as educator, protector, and comforter. Since I have done numerous deals and the seller normally hasn’t sold a business before, my goal is to educate the owner as to the process, identify in advance what the pitfalls will be and provide comfort to the owner in knowing that there is a trusted and knowledgeable adviser on the owner’s team. When you find all these things, you have likely found the right lawyer to help you sell your company. Doug Starcher is Co-Chair of Broad and Cassel’s statewide Corporate and Finance Practice Group. He has worked as a trusted advisor to entrepreneurial business owners in a variety of industries for nearly 28 years. He served as seller’s counsel in a business sale that was recognized by M&A Advisors out of New York as 2015’s Technology Deal of the Year over $250 million. He has been married to Linda for almost 30 years and has four lovely daughters. Founded by Alvin Cassel and Shepard Broad in 1946, Broad and Cassel LLP has more than 170 attorneys serving clients worldwide from nine offices located throughout Florida. For more information please visit www.broadandcassel.com. 33 BY: ROGER FORSHAW // ASSOCIATE DIRECTOR Throughout 2016, there were a number of significant acquisitions across the global biotechnology sector. While deal activity didn’t quite match the astounding heights of 2015, M&A in the sector rose by 25 per cent in Q3 and this momentum continued as 2016 drew to a close. A combination of high levels of small- and medium-sized deals, in addition to a number of high-profile deals from industry giants, ensured that interest in the sector remained high throughout. The largest deal of 2016 saw Bayer, the German drug manufacturing giant, announce the takeover of U.S. agricultural seed producer Monsanto for $66B. The acquisition transformed Bayer’s overall approach, increasing the size of its Ag business which was one of the company’s main priorities. Both the U.K. and U.S. were subject to the changing regulatory environments, which continue to have an impact on deals in 2017. There is speculation that the next President of the U.S. may see authorities take a more relaxed view on mega-deals, while the U.K. continues to negotiate its exit from the EU. Also, as the year goes on we may also see an increase in deals with the re-adjustment to the strength of sterling. M&A SECTOR SNAPSHOT BIOTECHNOLOGY T: +44 (0) 161 359 4415 E: FORSHAW@BENCHMARKCORPORATE.COM 34 WHY BIOTECH REMAINS STRONG While the significant cash piles at the disposal of many Biotech companies was certainly one reason behind activity in the sector, appetite for bolt-on acquisitions was particularly strong with a number of biotech businesses expanding in this way throughout 2016. Commentators have also noted the long-term strategy of a number of companies in adding scale to allow rivals to make bids for their business, highlighting Shire’s acquisition of Baxalta which has significantly bolstered sales for the business. Many acquirers in the sector have also acknowledged the large number of successful billion dollar and euro acquisitions, highlighting the expertise of acquirers in making the most of their purchases. KEY PLAYERS IN THE SECTOR Earlier last year, high-profile U.S.-based company Gilead Sciences was rumoured to be a potential target for pharma giant Merck. Analysts, however, speculated that the deal was unlikely, and Gilead itself were in fact looking to acquire. Rather than engage in large deal activity, Gilead is stated to be involved in a number of smaller purchases in this year, which will allow them to infill a host of sectors and markets as they look to expand their expertise. Abbot Laboratories’ acquisition of Alere was certainly one of the more complex deals of 2016. Throughout the deal a number of issues arose, including allegations of breaches of the merger agreement, calling the future of the transaction into question. Interestingly, Abbot is also still in the process of gaining approval for another biomedical acquisition of St Jude Medical. As the American multinational biotech Biogen continues its search for a new CEO, it is unlikely that it will announce any acquisitions until the role has been filled. The potential for Biogen to revise its strategy under a new leader, not to mention the potential for conflict should it appoint from a competitor, has seen the company hold fire on any new deals. However, Biogen’s current situation could result in the company itself being acquired. In August 2015, shares in the company rose following rumours it may be targeted for acquisition by companies search as Merck and Allergan, demonstrating their undoubted strength and coveted status within autoimmune and related sectors. THE FUTURE FOR THE SECTOR Over the course of 2016 the biotech sector has shown its fantastic resilience, with M&A playing a key role in the strategies of a number of the sector’s largest names. This is set to continue in the current year, whether that be industry leaders targeting successful and agile bolt-on companies, or mid-tier players looking to head-off interest from acquirers by scaling up. Get in touch with our experienced team with any questions you have about biotech M&A and how Benchmark International can help you. 35 FINANCIAL INFORMATION Net Revenue EBIT EBITDA Adjusted EBITDA Adjusted EBITDA Margin TTM 9/30/2016 50,651,079 11,197,338 21,054,566 24,062,045 47.5% 2015 45,806,028 11,817,392 20,704,960 22,435,459 49.0% 2014 42,190,064 10,739,538 18,828,362 19,580,370 46.4% 36 FEATURED BESPOKE OPPORTUNITY BY: CLINTON JOHNSTON // MANAGING DIRECTOR T:+1 813 898 2350 E: JOHNSTON@BENCHMARKCORPORATE.COM RET1036 is a lessor, dealer, and distributor of best-in-class aerial equipment. The company has been supplying telescopic and articulating boom lifts, scissor lifts, and forklifts to Florida construction sites for over 13 years. HEADQUARTERS Sanford, Florida MARKET CURRENTLY SERVED The company’s five locations, strategically placed throughout the State of Florida, allow it to service customers in the industrial, commercial, residential, institutional, construction, municipality and motion picture and television industries. FACILITIES The company has five locations. Three are leased from an affiliated entity, and two are leased from non-related third parties. The properties owned by the affiliate may be included in the sale or leased on a long-term basis. OWNERSHIP The company is owned by a father and son. The father, who is not involved in day-to-day operations is considering a possible exit strategy for future retirement. The son is excited to remain with the company in order to grow the business with the right partner. KEY FEATURES • One of the fastest growing aerial equipment rental companies in the State of Florida • Dealer of best-in-class aerial equipment brands that are recognized globally and maintained on-site at the highest quality standards • The company’s two major OEMs have named it the largest independent aerial work platform provider in the Southeast United States • Seasoned management team at each location that has been together since the early nineties • Strong industry presence and reputation developed and perfected during 13 years of operation • Immaculate facilities strategically placed within the vicinity of the major access routes of each metropolitan hub of Florida • Adept and flexible to industry cycles because of past experience and forward-looking planning • Customer-friendly proration of rental rates • Own and operate with software specifically designed for rental equipment businesses Overview: RET1036 “Lessor of brand-name Aerial Equipment, Parts & Related Services” 37 EMILY COGLEY What made you choose this profession? I have always been interested in international affairs. In college, I took additional business courses and found myself drawn to M&A. How do you spend your free time? I spend the majority of my free time travelling to see friends and family. If I have a short window, I travel to NY, CA, or within FL. I try to visit a different country once a year during vacation. Who inspires you the most? My grandfather. If you won the lottery, what would you do? If I won the lottery, I would dedicate some time to a trip to Asia. What were you doing before joining Benchmark International? I was working for a real estate development company in downtown Los Angeles. What are your top three qualities? Capability, creativity and timeliness. Favourite childhood memory? Boating with my family. What are you most afraid of? Lack of success – financial and personal. What has been one of the biggest moments in your life? Becoming the Broker for the Tampa office. What are your hobbies? Painting, travelling, attending concerts, and yoga/cycling. List five words to describe your character? Reliable, authentic, dynamic, hard-working, and kind. “Outside of your comfort zone is when great things happen.” SENIOR ASSOCIATE SPOTLIGHT T: +1 (813) 898 2350 E: COGLEY@BENCHMARKCORPORATE.COM 38 US HEADQUARTERS 4488 West Boyscout Blvd. Suite 400 Tampa, FL 33607 +1 (813) 898 2350 US@BENCHMARKCORPORATE.COM 39 Building and running a business can present many significant challenges. There exists a whole host of risks, it requires significant time and effort, and it draws on a wide range of different skills, not simply the knowledge of a particular product or service. However as every business owner knows, there are fantastic rewards every day that make it all worthwhile. Overcoming any challenge in life delivers a sense of achievement and the opportunity to create and sustain an organisation, to solve the key challenges of customers or clients and, ultimately, to generate growth and profits, are all very rewarding. It is, therefore, important for business owners to focus on the many positives associated with business ownership rather than get bogged down by the negatives. Continued success is difficult to achieve, but business owners in the U.S. and the U.K. have a whole host of reasons to be positive as they look to build, grow and navigate the challenges in their markets. REASONS TO BE CHEERFUL: OWNING AND RUNNING A SUCCESSFUL BUSINESS BY: PETER KELLY // DIRECTOR (TRANSACTIONS) T: +44 (0) 161 359 4412 E: PKELLY@BENCHMARKCORPORATE.COM 40 RED-TAPE, LEGISLATION AND BUSINESS INFRASTRUCTURE If owning a business was as simple as developing a product or service and selling it to customers, life for business owners would be very straightforward. However, whatever sector you operate in, a whole host of regulatory and commercial restrictions apply. Those who successfully navigate these can reap the rewards. The good news is that the World Bank’s rating system places the U.K. and the U.S. well-inside the top ten easiest countries globally in which to do business. The Bank’s 2016 rankings reflect the relative simplicity of starting a business, ease of completing the necessary documentation, and fairness of regulation enforcement as being consistently appealing to entrepreneurs. This can be seen in the technology sector: be it the well-developed funding ecosystem in the U.S.’s fabled Silicon Valley, or government ambition to attract major players to the U.K.’s own Silicon Roundabout, the technology sector exemplifies the world-leading expertise available to turn ideas into strong businesses. Also, it is not only the tech sector that benefits: the U.K. and the U.S. can lay claim to some of the most competitive and nurturing commercial environments globally, ensuring businesses are given every opportunity to achieve success. TAXATION AND INVESTMENT INCENTIVES The strength of the U.S. and U.K. economies can also be seen in the tax environment. Positives may take the form of a range of methods for tax relief. In the U.S., there are considerable incentives for operating in certain jurisdictions or locations, while the U.K. has long-established sector-specific “Enterprise Zones”. Meanwhile, these countries are unlocking the potential for investors; for example, in the U.K., there are competitive levels of capital gains tax and entrepreneurs’ relief which can really help businesses and business owners address the challenges they face in growing and investing. Following the tumultuous events taking place on both sides of the Atlantic since the start of 2016, future tax and business legislation is likely to remain stable in the coming years, creating a positive business environment. With the impact of the Brexit vote taking shape, there will certainly be renewed efforts from U.K. Government and legislators to continue this trend towards investment and growth. Patent box legislation is another area where the U.K. Government is continuing to optimise and refine its approach. Earlier in 2016, feedback from the OECD encouraged amendments to the existing rules, but patent box relief is a firm fixture in the U.K., and will encourage innovation and R&D for years to come. Business owners can, therefore, have confidence in the business environment offering continued opportunities to showcase their ability to develop, grow and succeed in the markets in the U.K. and the U.S. Get in touch with our experienced team with any questions you have about how Benchmark International can help you. 41 At Benchmark International, we cater to family-owned and founded businesses. With great frequency, our clients hold strong relationships with professional advisors; accountants, insurance professionals, wealth managers and attorneys. In the case of the attorney, she may be a family attorney, a corporate attorney, handle real estate transactions or some combination thereof. While these trusted advisors may provide terrific counsel on a great number of matters, they are rarely equipped to handle the nuances and rigors of an M&A transaction. Buyers, whether financial or strategic, are often armed with first- class advisors so any shortfall on the seller side can lead to buyer-friendly definitive agreements with onerous terms. Proportional seller-side reputation is of utmost importance. We have worked with a number of M&A transaction attorneys over the years and can recommend those that have demonstrated the combination of resourcefulness, knowledge, experience and judgement required to at once zealously represent their client while also working toward a successful transaction closing. Any attorney that has worked on an M&A deal or two can “paper” a transaction. However, an experienced M&A attorney will be able to distinguish between the issues that are truly meaningful and impactful to a seller and those that are not. For example, if your business has had 100% collection of Accounts Receivables (A/R) for the last decade, validating that your A/R is “good” may not be problematic for you. While that deal term may not be “market,” it still may not matter BY: DARA SHAREEF // DIRECTOR THE VALUE OF A TRUE TRANSACTION ATTORNEY T: +1 (813) 898 2388 E: SHAREEF@BENCHMARKCORPORATE.COM 42 to you. An inexperienced transaction attorney may latch onto that deal term and force negotiation with the buyer on a matter that really isn’t important to you. Conversely, a seasoned transaction attorney will use that deal term as a “win” they can give to the buyer in exchange for something that is truly valuable to you, the seller. Inexperienced M&A attorneys often attempt to create artificial value by parsing words and focusing on ancillary documents like an escrow agreement, for example, instead of focusing on substantive items like Representations and Warranties, Indemnification and Disclosure Schedules. Comparatively, M&A attorneys spend the bulk of their time on these key sections of the definitive agreements because they tend to have the most long-term impact on the seller. Transaction attorneys recognize the ebbs and flows of a deal. They know when the draft purchase agreement has been turned back and forth one time too many and will instead construct an issues list that can be worked through on the phone. Transaction attorneys have the experience and judgement to eschew the cookie cutter approach to deal making in favor of one that is bespoke to the issues and nuances of the deal. Our experience suggests that buyers invariably hire top- tier transaction attorneys. As professional buyers, they recognize the value a seasoned M&A transaction attorney provides. If sellers do not follow suite, they can very quickly find themselves in a positon of weakness. In the 26 deals we closed in 2016 out of our Tampa, FL headquarters, we saw buyers and their attorneys introduce sophisticated tax structures, esoteric deal terms like materiality scrapes and complex post-closing matters such as minority shareholder rights and sellers owning a different class of shares than the buyers. Definitive Agreements serve as the surviving documentation of the transaction. Without equal representation, sellers can find themselves overmatched and forced to suffer the consequences for many years post-closing. Experienced transaction attorneys also tend to work well with your other advisors. While attorneys that dabble in transaction work tend to get overly protective of their territory, seasoned M&A lawyers are very comfortable in what is expected from them in a transaction, and as such, it is easier for them to see the lines and where other specialists may provide value. For example, M&A lawyers tend to work well with other professional advisors like accountants, insurance advisors and business brokers/investment bankers. We often encounter clients that have an aversion to spending the “extra” money for a professional transaction attorney. We find this to be a misconception. Proper representation from a deal attorney can actually be more cost effective than engaging one’s personal or corporate attorney. A seasoned professional with a full M&A team behind him, will cut down the cost by moving most of the heavy lifting to junior members of the team like paralegals and associates. Also, when veteran deal attorneys are working as opposing counsel, we tend to experience less back and forth leading to far less hours charged to the seller. Perhaps most importantly, the likelihood of successfully closing a deal is greatly enhanced when the stature of the seller’s counsel matches that of the buyers. Professional deal attorneys help keep deals on track. They also tend to move them along at a swift pace. Like sharks, deals need to move to maintain life. The passage of time kills deals more than any other factor. It is incumbent upon the advisors on both sides to keep to the prescribed timeline. Professional advisors are critical to the successful completion of an M&A transaction. The attorneys, as gatekeepers of the definitive agreements, must be up to the task. Our experience suggests that buyers place enough value on the importance of capable counsel to hire top-tier M&A law firms. To maintain balance and increase the likelihood of success, it is imperative that sellers follow suite. 43 Advances in technology by agile, R & D focused start-ups is piquing the interest of acquirers across the IT & Telecoms sector. Areas such as the Internet of Things (IoT), cloud infrastructure and over-the-top video services are creating ample opportunity for bolt-on acquisitions, and M&A activity is demonstrating high levels of deal volumes across a range of markets within the sector. By gaining these specific technologies through strategic acquisitions, IT & Telecoms businesses are significantly expanding their portfolio of services. As a result, deal making is reaching new highs, with Q3 of last year seeing deal values reach almost $100B in the U.S. alone. Analysts project M&A within the sector to remain buoyant, as digital disruption is set to change the types of service offerings and business models throughout 2017. BY: JONATHON PARKINSON // ASSOCIATE DIRECTOR IT & TELECOMS M&A SECTOR SNAPSHOT T: +44 (0) 161 359 4413 E: PARKINSON@BENCHMARKCORPORATE.COM 44 TELECOMS AND REGULATORS While the $2tn IT sector is set to flourish, the telecoms sector continues to face a great deal of uncertainty from both regulators and political influence in the U.S. and the U.K. Analysts predict that following Brexit negotiations, greater powers may be requested by bodies such as the domestic regulator Ofcom to vet any potential acquisitions – particularly from strategically significant inbound investors. While this may be linked to Ofcom’s recommendation on the break-up of BT Openreach in 2016, it points to what could be busy upcoming years for telecoms giants and acquirers wanting to make the most of M&A opportunities. Now under the leadership of President Donald Trump, the U.S. may also face regulatory challenges over the coming months. Prior to his appointment, Trump had expressed reservations about deals including AT&T’s acquisition of Time Warner, as consolidation of this kind and size raises old arguments regarding consumer choice. Given Trump’s mandate, deals of this scale may become a natural area for intervention. As Trump’s term in office progresses, deal analysts wait with interest to see whether he will follow up on his pre-election thoughts. KEY PLAYERS IN THE SECTOR Dell’s $60B acquisition of EMC further reinforces the market-leading positions of both companies. Dell’s strengths in small- and mid-market customers will combine well with EMC’s large enterprise customer base, if a clear focus is delivered across each market. The deal is just one example of the pattern of consolidation within the IT industry and is set to make the company a strong player within the sector. Inbound M&A to the U.S. also came from France’s ATOS, which purchased unified communications company Unify for €366m at the beginning of 2016. The deal has allowed Unify to expand into full, managed services as well as bring ATOS products and services to its customers. DEAL ACTIVITY IN THE NEXT 12 MONTHS IT & Telecoms remains a dynamic industry sector. As developments in technology continue, IT and Telecoms businesses will further innovate and expand their service offerings, driving interest in bolt-on acquisitions. Should regulatory environments in the U.K. and U.S. remain open to inbound M&A, deal activity within the sector is set to continue at its positive pace. 45 TEE GWENA What made you choose this profession? I have always had an interest in business, private equity, venture capital or anything that resembles any of the aforementioned, so naturally this was a profession I would have come across at some point in my career. How do you spend your free time? Cars, cars, cars. Who inspires you the most? Tough one. I read a lot of biographies and follow a lot of successful people like Manny Khoshbin, Grant Cardone, Henry Crowell, John Malone (all men that truly inspire me) but my biggest inspiration has to be my father. He has achieved so much in his life and is without a doubt the hardest working person I know! If you won the lottery, what would you do? I would invest it all then with the returns start my own Formula 1 team. What has been one of the biggest moments in your life? Buying myself my dream car, a manual V10 Audi R8, at 22 certainly is up there! What are your top three qualities? 1. I am individual. I try to always think outside the box, I don’t like being like everyone else. 2. I am incredibly driven. I’m always goal-setting, I can’t function without goals and targets. 3. I listen far more than I speak. Favourite childhood memory? Living on a fabulous golf estate in the African sun, messing about on the golf course more or less daily after school and on weekends. What were you doing before joining Benchmark International? I started and ran several businesses mainly in the automotive sector. I also worked for an investment company, running its portfolio businesses and getting involved with deals in Africa, Dubai, China, France and Belgium. List five words to describe your character? Focused. Driven. Competitive. Quiet. Entrepreneurial. “Faith – If you don’t see it before you see it, you won’t see it.” SENIOR ASSOCIATE SPOTLIGHT T: +44 (0) 1865 410 748 E: GWENA@BENCHMARKCORPORATE.COM 46 CLI EN T T EST IM ON IAL WA TCH TH E LATE ST TESTIMON IALS O N O UR WEBSI TEWW W.B ENC HM ARK COR POR ATE .CO.UK/RE SUL TS/ CLI ENTCOM ME NTS CHET JO GLEKAR , CEO // C ON ARC “Th is is on e o f th e m ost im po rta nt decision s f or the co mp an y. I fel t very co mfortab le wi th Benc hm ark . Th ey ha d a n i nte rna tio nal ex po sure tha t h elp ed th e enti re pro cess. ” 47 Selling your company may be the most significant event in your career as a business owner. The stakes are extremely high because a successful deal is likely to yield great financial rewards. At the same time, the sale process can be very complex and mentally draining. Even the most successful and experienced business owners may find themselves unprepared for the challenges that arise during the sale process. The current economic climate further complicates the process. Potential buyers are now scrutinizing companies more closely than ever. Issues that were once considered minor may now delay or even kill a potential deal. By enlisting a professional to help conduct thorough sell side quality of earnings engagement on your own company early on will reduce the likelihood of critical issues arising later. This will in turn help ensure you receive maximum value for your company by allowing investment bankers and your other advisors to help you preserve value through the process. FINANCIAL STATEMENT AUDITS VERSUS QUALITY OF EARNINGS REPORT In the context of mergers and acquisitions, potential investors get a level of assurance when the seller has their financial statements audited or reviewed. However, buyers typically do not rely solely on the audited or reviewed financial statements when making an investment decision. Through testing and analytical procedures, an audit or review’s purpose is to provide assurance that management has presented a company’s financial performance and position materially correct, not to identify issues likely to be of interest to a buyer. THE POWER OF A SELL SIDE QUALITY OF EARNINGS REPORT BY: CRAIG R. ARENDS, CPA // CLIFTON LARSON ALLEN E: CRAIG.ARENDS@CLACONNECT.COM W: CLACONNECT.COM 48 Sell side quality of earnings is focused on providing potential investors with a deeper understanding of a company. This includes • Sustainable economic earnings • Historical sales and operating expense trends • Historical working capital needs • Key assumptions used in management’s forecast • Tax matters • Key personnel and accounting information systems. Although audits or reviews may provide a starting point for a potential investor’s evaluation of a company, they generally do not comment on the focus areas noted above. QUALITY OF EARNINGS For obvious reasons, investors are particularly concerned with the fair valuation of the business. Because businesses are often valued based on a multiple of EBITDA (earnings before interest, taxes, depreciation and amortization), sell side quality of earnings will focus on the “quality” or sustainability, of the company’s earnings. Unusual or non-recurring income and expense items, over/understated assets and liabilities, post- closing cost structure changes, and the inconsistent application of accounting principles are all analyzed to adjust historical EBITDA to reflect sustainable earnings. The sustainability of a company’s EBITDA is not reflected in a standard review report. TREND ANALYSIS Audit or review procedures may include analytics to understand trends and relationships over the historical period, but the reports do not comment on the market drivers behind those trends. Sell side quality of earnings reports address key market drivers, sales strategies, customer relationships and customer churn, and attempt to understand whether the trends reflected in the financials are sustainable. WORKING CAPITAL Buyers and sellers typically negotiate a “target” working capital to be delivered at transaction close. The negotiated amount is usually based on the average working capital balances over the previous twelve months, but a sell should also consider recent growth trends, (ii) industry conditions, (iii) the seasonality of the business, and (iv) the specific composition of working capital balances. An audit or review report does not provide insight into monthly working capital accounts, putting the seller at a significant disadvantage when negotiating the working capital target without understanding key drivers. QUALITATIVE OBSERVATIONS Perhaps most importantly, the sell side quality of earnings may provide key qualitative observations from discussions with management. These observations may include key findings regarding the company’s internal control structure, management and accounting team, and accounting information systems. Qualitative observations rarely appear in the financial statements, but may be just as important in helping a buyer make an investment decision. SUMMARY An audit or review provides assurance that management has presented a true and fair view of a company’s financial performance and position in accordance with well-defined rules and procedures. But for a seller, these can complement a sell side quality of earnings report which gives the buyer a more comprehensive understanding of the potential value of a targeted investment. CLA is a professional services firm delivering integrated wealth advisory, outsourcing, and public accounting capabilities to help clients succeed professionally and personally. CLA has more than 100 locations across the United States and has provided quality expertise for over 60 years. 49 There will be certain stages during the lifecycle of any business where growth becomes central to the plans of the owners. Growth can be accomplished in a variety of different ways: it may be that you wish to increase or expand certain parts of your operations, add to your headcount, break into new markets or increase your share in a current space. Whatever method is implemented to spur growth, it brings with it different challenges. These challenges are as individual as the business itself. While outside factors are important – such as the strength of demand in a local market, or access to adequate talent to increase headcount – internal factors inside the company should not be discounted as an important consideration when looking at growth. This is clearly demonstrated when looking at specific owners and the models that they use to run their companies. The only common characteristic of a business owner is just that – they own a business. Beyond that, when examining their backgrounds, their experience and knowledge, their goals and objectives, there will be a radical difference, even among those who may seem similar on the surface. Despite this variety, we can make some assumptions about the way business owners carry out their roles, and what they may need to do to de-risk their growth. UNDERLYING FACTORS Business owners may have significant talent in one specific area, which has been the basis of their success. Those business owners may well have the ability to develop a product or service which corners a market or moves them ahead of the competition. That said, such business owners may not have the skills or experience to deliver on a growth strategy and give the business the best chance of succeeding. Some businesses may, therefore, look to outside assistance to make this happen. DE-RISK YOUR GROWTH BY: JAMES SLOANE // ASSOCIATE T: +44 (0) 161 359 4424 E: SLOANE@BENCHMARKCORPORATE.COM 50 The growth strategy of a business may first require securing investment, either from existing sources of funding or new types of investors. Having acquired adequate capital to fund growth, operations become the focus and, typically, new procedures and revised processes must be implemented. Owners may not want, or have the time to, undertake such tasks while managing day-in day-out operations. Relying on outside assistance may be the best route to growing successfully while mitigating the risks associated with it. REMAINING BUT REDUCING RISKS Once the decision is taken to implement a growth strategy, it is crucial to seek the appropriate expertise and investment required. Outside investors can bring with them experience and skills to help businesses make the most of opportunities around new funding. With this may come a re- structuring of the ownership of the organisation, with new decision makers involved. Ceding decision making control to others may be an anathema for some business owners, particularly if they have never experienced this situation before. A host of different options are available, allowing different types of business owners to leverage different types of expertise, while also delivering different levels of outside control to suit the preferences of individuals. For example, licensing products can allow manufacturers to launch into new markets and sectors, bringing on board experienced operators while reducing any risks associated with unfamiliar commercial and regulatory environments. This allows a business owner to keep doing what they enjoy, while benefitting from the skills that can take their business where it needs to go. Get in touch with our experienced team with any questions you have about how Benchmark International can help you to grow your business. 51 Business 101 tells us that a failure to plan is simply a plan to fail. Working in our industry for as long as we have, we have absolutely no doubt that every owner we work with has heard this phrase enough times to make them roll their eyes and shout an “I know. I know.” Ironic then, that most owners develop an innovative and often complex plan to generate revenue but few, if any, spend time planning their exit. Let’s discuss a few reasons why 2017 is just the year to dust off the Business 101 textbook and consider planning your exit. While 2015 proved to be astounding for M&A, 2016 saw some of the highest values paid for businesses since 2007. Obvious factors, such as the presidential election and Brexit had a hand to play in the sluggish start to 2016 with regards to M&A. This was, of course, expected as political uncertainty nearly always breeds purchasing uncertainty. With a new president firmly in place and many realizing that Brexit has not had as severe of an impact as most expected, buying confidence has been back on a steady climb since the close of 2016. So much so, that a recent survey by tax and audit firm KPMG LLP found that of the nearly 100 corporate and private equity players surveyed in October 2016, 84 percent anticipate they’ll ink at least one deal in 2017. The survey also found that 40 percent expected to look at transactions because of limited organic growth options, while 25 percent indicated they were turning to M&A in response to a transformation in the broader marketplace. Growth & Innovation through Acquisition BY: NICK PERRY // DIRECTOR T: +1 (813) 898 2371 E: PERRY@BENCHMARKCORPORATE.COM 52 GROWTH & INNOVATION THROUGH ACQUISITION A fa i lure t o plan is simply a plan t o fa i l. CONTACT BENCHMARK INTERNATIONAL TODAY TO DISCUSS YOUR PLAN If you are contemplating the idea of an exit or bringing on a new partnership within the next few years then this next piece may be the most important factor to take into consideration with regards to the timing, as we are calling 2017 the “Year of Growth & Innovation through Acquisition”. Though the majority of M&A factors remain strong, such as low interest rates, low capital gains tax rates, and obscene amounts of dry powder needing to be spent, businesses are seeing a steady decrease in organic growth. It is this sluggish organic growth that will fuel most acquisitions in 2017. This presents a monumental opportunity for businesses owners in the lower middle market. The lack of organic growth means that acquiring parties will focus less on megamergers and focus more on small opportunities with plenty of room for growth. This also means that acquiring parties will focus less on “well-developed” opportunities that are at their pinnacle, as this only provides them an initial bump of top-line revenue. Instead, a focus on innovative and disrupting companies with massive potential upswings over the coming years will be at the heart of most of the deals closed in 2017. While many believe that innovation and disruption means that there will be a strict focus on technology companies, this is simply not the case. Sure, financial technology and digital health companies will likely continue to receive the highest of multiples, but the pressure to deliver new methods for growth is coming down on shareholders across all industries. The need to remain relevant across their respective landscapes present a serious opportunity for those owners that are now considering a sale but haven’t gone through the normal preparation process that is generally required to receive maximum value. Typically, in our space, those businesses that have been grooming themselves for a sale for years receive the absolute most value for their most prized asset. However, the need for acquirers to put their reserves to work and deliver strong growth patterns over the coming years could help to close the gap between those businesses that have prepped for sale and those that haven’t. Given that acquirers don’t necessarily want a business that has already fulfilled its potential without requiring the injection of massive amounts of capital to spur another growth cycle, owners that are considering a sale within the next few years but are “waiting for the numbers to improve” are likely doing themselves a disservice. We believe this because the need to grow through acquisition is simply the eye of the storm. Swirling around this mindset are a number of other factors that point to a potential record year for M&A in 2017. Add in a strong US economy, strong cash reserves, continued deal scarcity, holding low interest rates, and the potential for loosening regulation under the new president and potential sellers with a quality opportunity in the lower middle market find themselves standing in the center of a near perfect storm. However, as with all monumental opportunities, this storm comes with a time limit. Eventually, interest rates will go up and capital gains tax rates will increase. Deal scarcity will come to an abrupt end as the impending rush of baby boomers to fund their retirement through a liquidity event gets under way, and a significant increase in the number if IPOs will soon be upon us as acquirers complete their roll-up strategies. It is because of this time limit that we are encouraging any owner that is considering a full or partial sale of their business within the next few years to contact us today to begin to discuss their options, as there is no better time than today to start planning their exit. 53 Entrepreneurs are often thought of as national assets to be cultivated, motivated and remunerated to the greatest possible extent. They have the ability to change the way we live and work, and, if successful, their innovations may improve our standard of living. In addition to creating wealth from their entrepreneurial ventures, they also create the jobs and conditions necessary for a prosperous society. Failure is part and parcel of success, especially in the world of business. Very few, if any, entrepreneurs have ever made it big without hitting some speed bumps along the way and tasting defeat. However, it is their ability to bounce back and move past these setbacks that sets them apart. In this article we look at five high-profile entrepreneurs who have all overcome setbacks in the pursuit of the established success they enjoy today. JAMES DYSON – DYSON Sir James Dyson is a British inventor, industrial designer and entrepreneur who successfully manufactured innovative household appliances and became a determined campaigner DON’T GIVE UP BY: ANDY HANCOCK // SENIOR ASSOCIATE T: +44 (0) 161 359 4406 E: HANCOCK@BENCHMARKCORPORATE.COM FIVE ENTREPRENEURS WHO FAILED BEFORE THEY SUCCEEDED 54 to restore engineering and technical innovation in Britain. In the late 70s, Dyson came up with the idea of using cyclonic separation to create a vacuum cleaner that would not lose suction as it picked up dirt. He became frustrated with his Hoover Junior’s diminishing performance, as the dust bag kept becoming clogged with a lot of dust thus reducing suction. After five years, and countless prototypes, Dyson launched the G-force cleaner in 1983; however, no manufacturer or distributor would handle his product in the U.K., leading him to launch it in Japan through catalogue sales. After failing to sell his invention to the major manufacturers, Dyson set up his own manufacturing company, Dyson, Ltd in 1993. 10 years after his initial idea, he finally got his big breakthrough in the U.K. market thanks to a TV advert that emphasised that the Dyson vacuum did not require the constant purchase of replacement bags. The Dyson Dual Cyclone went on to become the fastest selling vacuum cleaner ever made in the U.K. and outsold those of some of the companies that rejected his idea, becoming one of the most popular brands in the U.K. In 2005, it was announced that Dyson cleaners had become the market leaders in the United States by value. Dyson was appointed a Knight Bachelor in the 2007 New Year Honours as well as being appointed the Order of Merit in the 2016 New Year Honours for his contributions and achievements in industrial design. NICK WOODMAN – GOPRO Born in 1975, in California, Nick Woodman is an American businessman and entrepreneur who founded GoPro. Prior to the creation of GoPro, Woodman founded two start- ups, both of which never fully made it off the ground. The first was a website called EmpowerAll.com, which attempted to sell electronic goods for no more than a $2 mark-up, the second was FunBug, a gaming and marketing platform that gave users the chance to win cash prizes. Neither took off and both, ultimately, failed – something Woodman took personally. While on his travels in Australia & Indonesia, Woodman would use a 35mm camera attached to the palm of his hand by a rubber band to try and capture his surfing activities on film. Seeing that amateur photographers like him wanted to do the same, Woodman found his inspiration to create GoPro. The original cameras he developed were point and shoot 35mm film cameras mounted to the user’s wrist. Since then, the product has evolved into a compact digital camera that supports Wi-Fi, can be remotely controlled, has waterproof housing, records to a micro SD card, and is affordable to the average action sports enthusiast. In December 2012, Taiwanese contract manufacturer, Foxconn purchased 8.88% of the company for $200M which set the market value of the company at $2.25B, making Woodman a billionaire. SIR RICHARD BRANSON – VIRGIN Sir Richard Branson struggled with dyslexia and had a hard time with educational institutions; however, he did not let this hold him back – in fact, it was the making of him. Still struggling, Branson dropped out of school at the age of 16 and was already displaying his entrepreneurial flair by starting his own magazine, ‘Student’. The publication, 55 run by students, for students, sold $8,000 worth of advertising in its first edition, which was published in 1966. Three years later he came up with the idea of running a mail-order record company called Virgin to help fund his magazine, before establishing a record shop on Oxford Street, London. The success of the record shop enabled Branson to establish Virgin Records in 1972, along with building a recording studio for his artists. Success soon followed and the record label became one of the top six record companies in the world. Branson sought to expand his entrepreneurial efforts once again, including the Voyager Group travel company in 1980, the Virgin Atlantic airline in 1984, and a series of Virgin Megastores. However, Branson’s success was not always predictable and by 1992 Virgin was struggling to stay financially afloat, resulting in the sale of Virgin Records to Thorn EMI for a reported U.S.$1B. The sale had a big effect on Branson but he remained determined to stay active in the music business. A year after the sale, he founded Virgin Radio and several years later started a second record company, V2. Branson’s Virgin Group now holds more than 200 companies in more than 30 countries and he has continued to expand his businesses to include a train company, a luxury game preserve, and mobile phone company. Not content with being restricted to Earth-bound pursuits, Branson has even added a space-tourism company, Virgin Galactic, to Virgin Group’s portfolio. JEFF BEZOS – AMAZON Born in New Mexico, in 1964, Bezos had an early interest in how things work, turning his parents’ garage into a laboratory FIVE ENTREPRENEURS WHO FAILED BEFORE THEY SUCCEEDED CONTINUED... 56 and rigging electrical contraptions around his house. His love for computers developed through high school and it was during his school years that he started his first business, The Dream Institute, an educational summer camp for 4th, 5th and 6th graders. After pursuing his interest in computers at University, Bezos found work at several firms on Wall Street. While his career in finance was extremely lucrative, Bezos chose to make the move into the world of e-commerce and quit his job in 1994 in order to target the untapped potential of the internet by opening an online bookstore. Bezos set up the office for his company in his garage where, along with a few employees, he began developing software. After inviting 300 friends to beta test the site, Bezos opened Amazon.com in the summer of 1995. The initial success of the company was meteoric, selling books across the U.S and reaching $20K a week in sales in its first two months. The company went public in 1997 and, despite many question marks being raised by market analysts as to whether the company could hold its own, Amazon outpaced competitors to become an e-commerce leader. As the years went by, Bezos continued to diversify Amazon’s offerings. Whilst many other dotcoms of the early 90s went bust, Amazon flourished, with yearly sales jumping from $510K in 1995 to over $17B in 2011. Before Amazon became a household name, Bezos had a number of failed ideas. One of the most notable was an online auction site, which evolved into ‘zShops’, a brand that ultimately failed. Still, his determination pulled him through and he was able to repurpose the idea into what would eventually become the Amazon Marketplace. PETER JONES – PHONES INTERNATIONAL GROUP, DRAGONS DEN & AMERICAN INVENTOR Born in 1966, in Maidenhead, Peter Jones is an individual who has shown his entrepreneurial zeal from a young age. At just 16, Jones capitalised on his love for tennis by earning money from giving lessons to friends and fellow pupils, leading him to set up his own tennis academy. During the early 90s and in his mid-20s, he experienced his first taste of defeat when his cocktail bar venture failed. He had also set up his own computer business but this also failed and forced him to give up his three-bedroom house, cars and, ultimately, left him with no choice but to return back home to live with his parents. Fast forward to 1998 and Jones was setting up his own business again, in the form of Phones International Group. It was a humble beginning as he would sleep on the office floor, but business soon took off. The firm experienced explosive growth with revenue totalling £14M by the end of the first year and £44M by the second. The company was one of the fastest growing businesses in Europe, with turnover for 2005/06 in excess of £150M, making Peter a multi-millionaire. Jones is one of the original Dragons on the hit TV show, ‘Dragons’ Den’, which started in January 2005 and has produced 14 series to date. Along with Dragons’ Den, Jones sold his idea for a show to the American Broadcasting Company, which became ‘American Inventor’, which itself went on to be a success. 57 MICHELLE RAHGOZAR, CPA How do you spend your free time? I like to stay active in my free time: trying different workout classes, going to the gym, bike riding and spending time with the family. If you won the lottery, what would you do? Probably buy a vacation home in the North East to escape the brutal Florida summers! I would also devote a lot more of my time (and money) to various charities - my favourite being the Humane Society. What has been one of the biggest moments in your life? Graduating my master’s programme and passing each of my four CPA exams on the first try, all in the same year. There was so much work that went into achieving both of those goals, and I am so proud of myself for accomplishing them. List five words to describe your character? Fun loving. Creative. Passionate. Respectful. Self-aware. Who inspires you the most? My father has been the biggest inspiration to me. My father was an immigrant and came to America at the age of 16 in order to pursue a better education. He did not speak the language or know anyone, but he worked to pay his way through college, learned English fluently, became a citizen and now owns his own engineering firm. He has always been my hero because of his drive to succeed and his willingness to help others in need. He has definitely made me who I am today and been my biggest supporter through my education and career. What are your top three qualities? I am very analytical and a fast learner, I love to goof around, laugh and smile, and I am extremely loyal. What were you doing before joining Benchmark International? Prior to joining, I worked in the core tax group of a large public accounting firm. I grew to realise that although I enjoyed my client-facing position, I was only being exposed to a small portion of my clients’ businesses by solely focusing on the tax side. I wanted to learn more and understand the inner workings of various businesses, so my curiosity of the unknown and fascination with learning about all businesses brought me to Benchmark International. “The doors will be opened to those bold enough to knock.” T: +1 (813) 898 2350 E: RAHGOZAR@BENCHMARKCORPORATE.COM ASSOCIATE SPOTLIGHT 58 CLI EN T T EST IM ON IAL WA TCH TH E LATE ST TESTIMON IALS O N O UR WEBSI TEWW W.B ENC HM ARK COR POR ATE .CO .UK /RE SUL TS/ CLI ENTCOM ME NTS ROGER WA RKENTINE, CEO // COM PUTER RX “Th ey were willi ng to ta lk ab out wha t th eir go als w ere an d t he y were very friend ly. Th ey were in terested in being in vo lve d i n t he lon gevity o f th e b usi ness. ” 59 You’ve spent years building your business. It’s worth tens or hundreds of millions. Now, thanks to favorable multiples, new opportunities, or a m¬¬ultitude of other reasons, you have decided to sell. Of course, the price you get is one of the most important factors in agreeing to a deal. Right behind that is the structure of the deal. The structure impacts which obligations remain with you and which obligations the buyer assumes; the structure impacts the liabilities for which you, the owner, have to indemnify the buyer; and the structure impacts the size of your tax bill – i.e., the amount of money taken from your pocket to pay your tax obligation on the sale. Think about it. One of the largest expenses you’ve incurred while your business grew is income tax. Depending on deal structure, the difference in the tax rate on your gain could be from 20% to more than 40%, and that is before more complex tax planning is done. In short, the structure of the deal has a significant impact on the amount of tax you will owe, the timing of payment of that tax, and the amount of money that reaches your pocket. AMOUNT In general, sellers and buyers have competing tax interests in how they structure a deal. In the purchase of a corporate business, a buyer usually will prefer asset sale treatment, so that it can take depreciation deductions and other write offs on much of the purchase price. In the same deal, the seller usually will prefer a stock sale, because more of the sales price will be taxed at capital gains rates. To visualize the impact of the sale structure on the amount of tax you will owe, consider the simple example below: • You have owned the business for more than a year and all valuable assets in the business (other than receivables and inventory) have been owned for more than one year. • You are actively involved in the business. • The sale will net $50 million of gain before taxes, and of that amount $10 million relates to ordinary income assets that have not been taxed (e.g., inventory, receivables, and recapture of depreciation). • All capital gain will be taxed at 20% and all ordinary income will be taxed at 39.6%. BY: PETER A. SCHOEMANN // BROAD AND CASSEL T: +1 (407) 839-4200 E: PSCHOEMANN@BROADANDCASSEL.COM Tax Structure of the Deal: A Multi-Million Dollar Decision 60 Photo by Erika Grace Photography How much of the $50 million will you have to pay to the United States Treasury? As the following table illustrates, the answer varies widely depending on the type of entity in which you operate your business and the structure of the sale: Keep in mind that the above amounts are approximations. Several factors can cause the amount of tax to increase. For example, in a stock deal a buyer may require that the seller make a tax election to treat the sale as an asset sale for tax purposes. Such an election would increase the above tax liability by almost $2 million. For another example, most deals include restrictive covenants, such as a covenant not to compete. The IRS will expect you to allocate part of the purchase price to those covenants, which price will be taxed at ordinary rates. TIMING Many sales include deferred payments. Deferrals may result from a holdback or escrow – typically used for post-closing adjustments, such as security for working capital adjustments and indemnification by the seller to the buyer. Deferrals also may result from an earnout – an additional payment that can be earned by the seller based on the performance of the purchased business post closing (as opposed to an additional payment for the seller’s services post closing). Generally, although not always the case, the taxpayer can defer tax payment until the deferred proceeds are received. Be aware, however, that purchase price deferrals may also be a trap for the unwary. Generally, when portions of the purchase price are deferred you apply the basis in your stock/assets evenly across the payments you receive, rather than using all your basis to reduce the tax owed in the year of closing. For example, if you are paid $40 million at closing and $2 million a year for each of the 5 years following the sale and you have a $20 million basis, you can use only $16 million of your basis to reduce the gain in the year of closing and will have to apply the remaining $4 million ratably over the next 5 years. Sometimes parties agree to earnouts with various contingencies. If you are not careful, the amount of basis you can apply in the year of sale will be less than you expect. In the example above, what if both parties agree that the earnout will result in approximately $10 million over 5 years, but the buyer offers a sweetener, i.e., no maximum on the earnout? If the buyer hits it out of the park on its new business, the seller will earn a lot more. This seems like a good deal for the seller, except that because there is no certain purchase price or maximum purchase price, the regulations require the seller to divide the basis evenly over 6 years, i.e., $3.3 million a year. The seller’s use of basis in the year of the closing just dropped from $16 million to $3.3 million, resulting in a $12.7 million increase in sale year gain. Knowing this, the seller could have suggested a cap on the earnout, maybe a cap well above the expected $10 million to get the economic upside and still apply much more of the basis in the year of sale. If a maximum earnout were set at $20 million, there would be a lot of upside and the basis would be divided over a potential $60 million, so that two-thirds of the basis (40/60), instead of one-sixth (with no maximum earnout), would be applied in the year of sale. CONCLUSION The purchase price is of primary importance when negotiating a deal, but don’t forget about the structure of the deal. Without considering the tax consequences, the additional purchase price for which you fight so hard may just be paid over to the government in unnecessary, or unexpected, taxes. For this reason, it is vital to make sure your legal team includes a tax advisor at the beginning of sale negotiations. The amount you pay the advisor to help structure the deal could save you millions. Pete Schoemann has practiced as a corporate tax lawyer since 1999, focusing on a variety of areas: including M&A, business structuring, and formation and operations of LLCs, corporations, and partnerships. After receiving a Masters in Accounting and graduating first in the LLM program at the University of Florida, Mr. Schoemann clerked for the Honorable Carolyn P. Chiechi of the United States Tax Court in Washington D.C. Founded by Alvin Cassel and Shepard Broad in 1946, Broad and Cassel LLP has more than 170 attorneys serving clients worldwide from nine offices located throughout Florida. For more information please visit www.broadandcassel.com. 61 Type of Business S Corporation (e.g., corporation or LLC electing S status) Partnership (e.g., limited partnership or LLC that does not elect corporate status) Tax on Asset Sale $11.96M $11.96M Tax on Equity Sale $10M $11.96M Retirement – many business owners shudder at the sound of it. For entrepreneurs, retirement does not hold the same meaning as it does for the rest of the population. Many business owners can’t imagine a lifestyle where they reduce their workload, or hand over control of their business to a third party, particularly if they have built it from the ground up. Retirement itself is an ever-changing concept anyway, due to factors from population trends to advances in technology. In 2016, people are living longer and those entering the workforce are unlikely to expect to stay in the same career or industry for their entire working lives. Already, new generations such as Millennials are displaying very different career expectations and trajectories from Baby Boomers. This is prompted by new types of company structures, from agile technology operators such as Uber, who use labour and the workforce in a different way to traditional employers. WHY THE “R” WORD SHOULD GIVE BUSINESS OWNERS PEACE OF MIND BY: PETER SALE // ANALYST T:+44 (0) 161 672 6230 E: PSALE@BENCHMARKCORPORATE.COM 62 Whatever the long-term trends, those business owners who are looking to retire in the near- or medium-term will have to keep in mind that their personal working patterns may be impacted by new modes of working. Equally, new types of relationships with companies may be appropriate over time – for example, technology can provide older workers with the opportunity to complete different aspects of their job remotely, from home or elsewhere. TARGETS AND PLANNING In our activities with businesses of all shapes, sizes and maturities, we meet business owners who have different approaches to retirement: from, “Yes, one day, but I’m not there yet”, through to, “I want to start planning my exit because the time is right”. However, as in any personal situation, it can be difficult to get perspective on your position and the underlying motivators that are guiding you in your actions. Retirement is a significant step and an unfamiliar process for those contemplating it. You can only be sure if it is right for you once you are experiencing it, and herein lies the risk. Retirement is seen as such a step for business owners because it is seen as something that you can’t reverse. But, as with any decision, there are different kinds of retirement and a number of options available. THE DEVIL IN THE DETAIL Those contemplating retirement, naturally, have to weigh a host of competing interests. First, and foremost, who will run the business once they decide to exit: if it is to be passed on to the next generation, are there suitable candidates? If not, where do business owners look to safeguard the future success of the business? Many exit strategies are tied to the continued success of a business, so it is crucial that sound decisions are made in the long-term interests of the business. Complementing this food for thought is the manner of the exit. There are a range of exit strategies which bring with them a variety of benefits, with tax advantageous implications, as well as short-term and long-term approaches that can be tailored to the individual. As a result, it really is possible to create a retirement plan that balances the competing pressures of your financial future and your legacy as a business owner. Most importantly, the decision you make should allow you to continue with your interests – be they in business or elsewhere – once you no longer own that business. THE NEXT STEPS Retirement should be treated with the same care and attention as any other significant business decision or transaction. During your life as a business owner and entrepreneur, you will have achieved success by taking smart and calculated risks, which allowed you to go on to bigger and better things. Planning and implementing your retirement strategy requires the very same analytical skills and business intuition that brought you success. By consulting with the experts, you can supplement your knowledge with that of experienced operators who have helped plan and carry out these strategies over many years. 63 BY: SHAUN FARNDEN // SENIOR ASSOCIATE As 2016 drew to a close, the manufacturing sector in both the U.S. and the U.K. experienced steady growth. From Q3 onwards the U.K.’s Markit/CIPS survey data highlighted four consecutive months of growth, while the U.S. USM data exhibited similar positive growth despite concerns regarding the strength of USD. The continuing growth of the manufacturing sector in both the U.S. and U.K. markets has been accompanied by equally strong deal making, with high-profile deals from last year demonstrating the healthy appetite for acquisition from both sides of the Atlantic. Irish food manufacturing giant Greencore announced the acquisition of U.S. food manufacturer Peacock Foods for $747.5M, allowing it to secure access to the U.S. market. Outbound M&A from the U.S. has followed a similar pattern, with Tesla announcing its deal to acquire automation firm Grohmann in an effort to bolster its manufacturing automation capabilities in Germany. EMERGING MANUFACTURING TECHNOLOGIES Long-term trends in the sector point to new directions for interested acquirers. In particular, additive manufacturing, or 3D printing, is set to revolutionise the supply chains of a whole host of industries, including diverse sectors such as aerospace, MANUFACTURING T:+44 (0) 1865 410 744 E: FARNDEN@BENCHMARKCORPORATE.COM SECTOR SPOTLIGHT: 64 automotive and industrial manufacturing, as it significantly reduces the time and resources needed to create parts or components which are currently created using forging and casting techniques. Earlier in 2016, GE Aviation announced the formation of a new additive manufacturing division following acquisitions worth $1.4B across Europe. By acquiring this equipment and IP, the company will be able to work at the forefront of the development of technology as it phases in new techniques for current and future aero-engine projects. With such technology now residing in-house across a number of companies, the strong influence of tech in manufacturing may lead acquirers to look outwards when making strategic purchases. KEY PLAYERS IN THE SECTOR GE Aviation’s active lead on additive manufacturing also underlines the race to integrate new technologies into existing manufacturing giants. U.S. motor giant Ford has invested, through its stake in early venture capital vehicle RPM Ventures, in a number of start-ups to buy in new technology to aid its development of autonomous vehicles, including mapping companies Velodyne LiDAR and Civil Maps. Siemens has taken a similar approach in its acquisition of semiconductor industrial software company, Mentor Graphics, for $4.5B. Utilising Mentor’s testing and design capabilities, the acquisition has been tipped to give Siemens access to the early stages of the manufacturing supply chain for its customers. Given the fact that crucial efficiency gains and cost savings can be made in the design and testing of components and products, it is hardly surprising that giants such as Siemens are keen to acquire capabilities that allow changes to designs to be made much more quickly and go to market in shorter timeframes. While there has been concerns that acquirers may be deterred from purchasing U.K. companies following last year’s Brexit vote, a steady stream of inbound M&A has proved otherwise. U.S. instruments manufacturer Ametek has acquired Wrexham- based Nu Instruments, which manufactures magnetic sector mass spectrometers for use in advanced laboratory analytics, in a deal which bolsters Ametek’s portfolio thanks to Nu’s customer base of high-profile institutions. FUTURE MANUFACTURING From M&A to buy-in new technology, through to deals to break into new markets, manufacturing remains an extremely active sector. While political uncertainty shrouded 2016, the outlook is positive for this year and analysts predict that confidence in both the U.S. and U.K. markets will boost demand for the sector’s services and products, stimulating more sector growth. 65 UK Listings: Call +44 (0)161 359 4404 or email HALAI@BENCHMARKCORPORATE.COM During the course of 2016, Benchmark International completed a number of fantastic deals which showcased the quality and range of our work. This required both a strong performance from our individual team members, as well as a solid team ethic that draws these skills together to service our clients in the best way possible. Each and every year talented individuals are commended for their work through nominations and award wins, with our organisation as a whole participating in numerous awards ceremonies throughout the years. Time and time again, the judges of these awards highlight our focus on working closely with businesses to truly understand them – with all success then following on from this. We would like to commend the fantastic achievements of everybody at our offices in the U.K. and the U.S. for the following award wins and nominations. BENCHMARK INTERNATIONAL COMPANY VICTORIES We are proud to look back on the impressive award wins achieved in company award categories for work in both the U.S. and the U.K. This year we won the following awards: • Winner of “Business services” award at the Best of Tampa awards. • Winner of “Corporate Exit Strategy of the Year” award at the Corporate Livewire M&A awards. • Winner of “International Corporate Financial Advisor of the year” at the Worldwide Financial Advisor Magazine awards. • Winner of “Best Company Sales Specialist” and “Award for Excellence in Exit and Growth Strategies” awards at the Acquisition International awards. We also received nominations in the following award category: • “Deal of the year (Sub £10m)” at the Insider Media Dealmaker awards. Congratulations to all those involved in these achievements. BENCHMARK INTERNATIONAL INDIVIDUAL WINNERS Alongside our proven track record of industry award wins, individual talent from across the company surged ahead of the competition to win an impressive collection of awards, at all levels of business. This demonstrates the strength of our team members, whichever role they play in our successes. Kendall Stafford: winner of the “40 Under 40” and “Emerging Leaders: Dealmaker” awards at M&A Advisor. Kendall Stafford was recognised by M&A Advisor as one of its “40 Under 40”, winning the emerging leader in the “Dealmaker” category, for her work within the Texas region. David Fergusson, President and Co-CEO of The M&A Advisor, said: “The Annual M&A Advisor Emerging Leaders Awards was born as the 40 Under 40 Awards in the United States in 2010 to recognise and celebrate the achievements of young M&A, Financing and Turnaround professionals who had reached a significant level of success and made a notable contribution to their industry and community.” Greg Jackson: a winner of the “CEOs of the year” award at Acquisition International. Greg Jackson was identified by AI Magazine as one of the CEOs of year for 2016, recognising his key role in the rapid growth of the company in 2016. Only 15 CEOs are recognised each year, demonstrating the fantastic achievement as a true leader within the M&A industry. AWARDS ROUND-UP FOR 2016 BY: BRITTNEY ZOELLER // DIRECTOR OF MARKETING T:+1 (813) 898 2350 E: ZOELLER@BENCHMARKCORPORATE.COM 66 CLI EN T T EST IM ON IAL WA TCH TH E LATE ST TESTIMON IAL S O N O UR WEBSI TEWW W.B ENC HM ARK COR POR ATE .CO.UK/RE SUL TS/ CLI ENT COM ME NTS ANN ZD ANS KY, CE O / / THE COM MO N SOURCE “Everyo ne wa s alw ay s ve ry pro fes sio na l; I never felt li ke I wa s j ust a c ust om er. Th ey a lw ay s pro vid e a hig h lev el of se rvi ce a nd c om for t. Ba sed on my ex pe rie nc e wi th Be nc hm ark , I wo uld h igh ly rec om me nd p eo ple t o use t he m. ” 67 Each year the Benchmark International team gathers to celebrate, learn and grow, but at this year’s DreamMark Conference there was a special thrill in the air. The theme of the two-day celebration, Game Changers, and its motto of “We’re not here to play the game, we’re here to change it” exuded enthusiasm, but there was more to the excitement in the air than the words emblazoned across everyone’s back. 2016 was a record-breaking year for the Mergers and Acquisitions industry, but more importantly, for Benchmark International. Benchmark International’s stellar results in 2016 were achieved against all odds considering the major events in both Europe and the United States. During 2016, the Benchmark International team broke records in terms of deals closed and value added for our clients. The collective feeling of accomplishment achieved in 2016 permeated the air at DreamMark as the “Benchmarkers” celebrated. The event provided the opportunity for Chief Executive Office, Greg Jackson, and Chairman, Steven Keane, to share their vision for the future of the business, which includes additional geographic expansion. Looking forward, Benchmark International will continue to focus on changing the way Mergers and Acquisitions are done and deploy innovative strategies to help our clients achieve their goals and aspirations. The DreamMark conference provided Benchmarkers the opportunity to hear more about 2016’s marquee moments featuring educational panels on each team’s accomplishments, learn some best practices, and participate in fun, team-building events, while discovering the exciting opportunities and plans for the year ahead. BY: LATECIA JOHNSON // DIGITAL MARKETING SPECIALIST T: +1 (813) 898 2368 E: JOHNSON@BENCHMARKCORPORATE.COM 68 Benchmark International is proud of all of its hard-working and dedicated employees. Among the cream of the crop is Shannon Hess, who was recently honored winning the 2016 Employee of the Year award. This is a very prestigious award so it is of course a huge deal to earn the title. Shannon is always one of the first people to enter the office and one of the last people to leave. It’s easy to see why she is deserving of the award. Among her other many attributes, Shannon is very modest. When asked why she thought she won the award, she replied, “It’s a mystery to me!” She realizes that when she cares about what she’s doing, she gives everything she has. Her passion, drive, and strong work ethic helped her get where she is today. Shannon understands she has to make things happen, that things just don’t happen on their own. She says, “I feel Benchmark is genuinely helping people and that appeals to me.” A favorite quote Shannon lives by is from Napoleon Hill: “Some people dream of success while others wake up and work hard at it.” When she’s not taking the M&A world by storm, Shannon loves being with her family. She raised four kids and is inspired by her own mother, who comes from a long line of successful women who made things happen when the odds were against them. Her mother held a director’s position without formal education. Shannon talked lovingly about her mother, describing her as her “true north” because she always helped guide her. She believes the women in her family are successful because of their God-given talents. The hard work doesn’t stop here. Although 2017 is only just beginning, Shannon is still putting all her time, talent and dedication into her job. The future is looking bright for Shannon and for her time at Benchmark International. BY: KRISTIN KIMBLE // ANALYST T: +1 (813) 898 2360 E: KIMBLE@BENCHMARKCORPORATE.COM 69 20 1 6 UNITED STATES EMPLOYEE OF THE YEAR John Lee began his journey with the Boy Scouts as a child, creating memories that would last a lifetime. He credits the Boy Scouts program for instilling in him the discipline, courage and confidence he gained at a young age and that followed him into adulthood. Following years of determination, John’s efforts were rewarded when he earned the rank of Eagle Scout at age 16. It was during this crowning moment he realized his call as an Eagle Scout was to help other young men spread their wings and achieve their highest potential. John has spent 25 years with the Boy Scout organization, working with hundreds of young men to shepherd them through the program. He became a Scout Master at age 23 and is heavily involved in the Alamo Area Council, which serves a 13-county area in Texas, as a trainer for Scout Masters and the Youth Protection program as well as a merit badge counselor on over 24 merit badges. John has had numerous rewarding experiences during his involvement with the Boy Scouts. One of the most memorable is the four years he spent sponsoring outreach programs in Miami. During that time, John and his team worked with juvenile parole officers to transition at-risk youth away from damaging experiences, like gang membership, to more positive affiliations like those with the Boy Scouts. The program was very successful in helping the young men turn their lives around. Many eventually went to college, one became a minister and, most notably, another enrolled in medical school to become a heart surgeon. Another one of John’s favorite experiences was founding a Scout troop in an area of San Antonio experiencing extreme poverty. He coordinated education efforts and fundraising initiatives to provide the young men, and their families, the necessary tools to pay for the Boy Scouts program, trips and camping excursions. In 2012, John Lee was recognized for his commitment to the organization when he was named Scout Master of the Year. John’s involvement in the Scouts organization has been extremely successful. About 90% of his troop progress from Boy Scouts to Eagle Scouts; a feat that is remarkable considering only 5% typically make that transition. John has given much of his life to help lift and inspire the young men to recognize the greatness they have inside. BY: KRISTY SPEER // SENIOR ANALYST T: +1 (813) 898 2393 E: SPEER@BENCHMARKCORPORATE.COM WHY COMMUNITY ACTIVITY IS IMPORTANT TO US 70 BENCHMARK INTERNATIONAL CARES 71 We are always looking for a meaningful cause to get behind and so far in 2017 we have donated to the following US charities: ACQUIRED BY Distribution & Storage ACQUIRED BY Recruitment & Training ACQUIRED BY Landscaping ACQUIRED BY Manufacturing & Industrial ACQUIRED BY Recruitment & Training ACQUIRED BY Building & Construction ACQUIRED BY Mechanical Services ACQUIRED BY Recruitment & Training ACQUIRED BY Motor, Transport & Marine ACQUIRED BY Distribution & Storage ACQUIRED BY Wholesale ACQUIRED BY Distribution & Storage ACQUIRED BY Engineering ACQUIRED BY Electrical Distibution ACQUIRED BY Distribution & Storage A SELECTION OF DEALS PRIVATE INVESTOR NEWBURY INVESTMENTS LIMITED HEARTLAND SERVICES LIMITED 72 ACQUIRED BY Manufacturing & Industrial ACQUIRED BY Cloud Solutions ACQUIRED BY Printing Equipment ACQUIRED BY Renewable Energy ACQUIRED BY Manufacturing & Industrial ACQUIRED BY Engineering ACQUIRED BY Manufacturing & Industrial VH HOLDINGS LIMITED ACQUIRED BY IT & Telecoms ACQUIRED BY Travel & Tourism ACQUIRED BY Manufacturing & Industrial ACQUIRED BY Manufacturing & Industrial ACQUIRED BY IT& Telecoms KEITH GALE CONSULTING LIMITED ACQUIRED BY Engineering ACQUIRED BY Care, Health & Medical ACQUIRED BY IT & Telecoms ACQUIRED BY Catering & Leisure ACQUIRED BY x ACQUIRED BY Distribution & Storage ACQUIRED BY Manufacturing & Industrial ACQUIRED BY IT & Telecoms Landscaping ACQUIRED BY IT & Telecoms ACQUIRED BY Print & Publishing ACQUIRED BY Care, Health & Medical ACQUIRED BY Distribution & Storage ACQUIRED BY Retail HERITAGE APPEAL LIMITED ACQUIRED BY Security Services ACQUIRED BY Utility & Maintenance ACQUIRED BY IT & Telecoms ACQUIRED BY Private Equity Buyer ACQUIRED BY Manufacturing & Industrial FRANCIS HOLDINGS LTD. 73 2009 S Capital of Texas Hwy Suite 300 | Austin | Texas | 78746 T: +1 512 347 2000 | F: +1 813 280 9871 E: AUSTIN@BENCHMARKCORPORATE.COM AUSTIN We have a deep appreciation for local business climates, cultures and respective practices around the world. That’s what allows us to accurately understand both sellers and buyers. AROUND THE CORNER, AROUND THE WORLD BENCHMARK INTERNATIONAL LOCATIONS 3333 Piedmont Road | Suite 2050 Atlanta | Georgia | 30305 T: +1 404 736 9188 | F: +1 813 280 9871 E: ATLANTA@BENCHMARKCORPORATE.COM ATLANTA 74 2101 Cedar Springs Road | Suite 1050 Dallas | Texas | 75201 T: +1 214 347 0691 | F: +1 813 280 9871 E: DALLAS@BENCHMARKCORPORATE.COM 4488 West Boy Scout Boulevard l | Suite 400 Tampa | Florida | 33607 T: +1 813 898 2350 | F: +1 813 280 9871 E: TAMPA@BENCHMARKCORPORATE.COM 590 Madison Avenue | 18th Floor New York City | New York | 10022 T: +1 212 521 4371 | F: +1 813 769 3516 E: NEWYORK@BENCHMARKCORPORATE.COM DALLAS TAMPA NEW YORK Conference House | 152 Morrison Street The Exchange | Edinburgh | EH3 8EB T: +44 (0)131 526 3188 | F: +44 (0)131 200 6200 E: EDINBURGH@BENCHMARKCORPORATE.COM EDINBURGH 75 11th Floor | The Broadgate Tower 20 Primrose Street | London | EC2A 2EW | England T: +44 (0)207 904 1050 | F: +44 (0)207 887 6001 E: LONDON@BENCHMARKCORPORATE.COM Benchmark House | Folds Point Bolton | Greater Manchester | BL1 2RZ T: +44 (0)161 359 4400 | F: +44 (0)161 359 4401 E: MANCHESTER@BENCHMARKCORPORATE.COM LONDON MANCHESTER Block 4 | Harcourt Centre Harcourt Road | Dublin | 2 T: +35 31 901 0162 | F: +35 31 901 4610 E: DUBLIN@BENCHMARKCORPORATE.COM 101 Park Drive | Milton Park Oxfordshire | OX14 4RY T: +44 (0)1865 410 050 | F: +44 (0)1865 410 051 E: OXFORD@BENCHMARKCORPORATE.COM DUBLIN OXFORD 76 20/F & 33/F 100 QRC | One International Finance Centre | 1 Harbour View Street | Hong Kong T: +8 52 3669 8000 | F: +8 52 2166 8999 E: HONGKONG@BENCHMARKCORPORATE.COM 35th and 36th Floor | UOB Plaza One 80 Raffles Place | Singapore | 48624 T: +8 52 5808 1909 | F: +8 52 3669 8008 E: SINGAPORE@BENCHMARKCORPORATE.COM HONG KONG SINGAPORE The Colosseum | First Floor, Century Way Century City | Cape Town | 7441 T: +2721 300 2055 | F: +2721 526 0311 E: SOUTHAFRICA@BENCHMARKCORPORATE.COM Oceania Business Plaza | Tower 2000 Urbanizacion | Punta Pacifica | Panama City T: +1 214 295 3174 | F: +1 813 280 9871 E: PANAMACITY@BENCHMARKCORPORATE.COM CAPE TOWN PANAMA CITY 77 AWARD RECOGNITION TEAM OF THE YEAR YOUNG PROFESSIONALS AWARD DEAL OF THE YEAR (SUB £10M) BEST FOR GROWTH/EXPANSION 50 MOST POWERFUL M&A FIRMS IN THE WORLD CORPORATE EXIT STRATEGY OF THE YEAR: FINGERPRINT 2016 KENDALL STAFFORD BENCHMARK INTERNATIONAL GREG JACKSON BENCHMARK INTERNATIONAL BEST COMPANY SALES SPECIALIST LEADING MERGERS & ACQUISITIONS ADVISOR OF THE YEAR, UNITED STATES BEST OF THE BEST IN FINANCE EXIT AND GROWTH STRATEGIES INTERNATIONAL CORPORATE FINANCIAL ADVISOR OF THE YEAR 2016 DEAL OF THE YEAR INTERNATIONAL CORPORATE FINANCE ADVISOR INTERNATIONAL MID-MARKET CORPORATE ADVISOR DEALMAKER OF THE YEAR INTERNATIONAL CORPORATE FINANCIAL ADVISER DEAL OF THE YEAR CORPORATE FINANCE EXPERTS OF THE YEAR - USA TECHNOLOGY DEAL OF THE YEAR (OVER $250MM TO $500MM) SALE OF RX30 2015 14TH ANNUAL M&A ADVISORS AWARDS 78 EMAIL US TODAY AT ENQUIRIES@BENCHMARKCORPORATE.COM OPEN TO THE OPPORTUNITIES? 79 U.K. HEADQUARTERS: CALL +44 (0)1865 410 050 OR EMAIL UK@BENCHMARKCORPORATE.COM U.S. HEADQUARTERS: CALL +1 813 898 2350 OR EMAIL US@BENCHMARKCORPORATE.COM WEBSITE: BENCHMARKCORPORATE.COM </p>
