Record results show investors still in market
The Journal
28th July 2010
THE corporate finance team at a Newcastle-based accountants has recorded its best half-year results since the department was launched 10 years ago.
Since the beginning of 2010, Tait Walker has advised a number of North East-based clients, operating across a range of sectors, on deals with a combined value of £45m.
They have provided a range of services including sourcing buyers, securing funding and carrying out due diligence.
The most high-profile deal saw the team sourcing and securing a buyer for NEMs, the Sunderland and Newcastle-based metal warehousing company which was sold for an undisclosed sum to commodity trader and global operator Trafigura.
When sourcing a buyer for NEMs, Tait Walker received a number of approaches, all from overseas investors.
Partner Michael Smith said: “For the first half of this year deal activity revolved, in the main, around disposals.
“A lot of interest is coming from overseas investors and I believe there are a number of reasons why this is the case.
“For example, the exchange rate of the Euro makes regional companies which export to the Euro zone attractive, as their goods are well priced when compared to those manufactured in Europe.
“In a second trend, access to Finance for Business North East funding, which is not available in areas such as Yorkshire and Manchester, places the region in a strong position to attract business start-ups and support those in the early stages of development.
“It is filling an equity gap for funding requirements under £2m.”
Other deals to conclude between January and June have included sourcing funding from a private investor on behalf of a regional retailer to assist with its ‘roll out’ programme of opening more stores across the region, aiding the directors of temporary accommodation provider Procomm to complete an MBO, and the de-merger and subsequent partial sale of a large manufacturing and distribution group in the area.
Looking towards the remainder of the year, Mr Smith added: “While we continue to operate in a tough market, investors are still out there looking to acquire well-managed, profitable businesses and I believe that disposal activity will remain constant.
“The recent increase in Entrepreneur’s Relief to £5m is a big incentive for owner-operators to build their businesses now because when they come to sell they can shelter a lot of tax liability on disposal.
“Add to this the availability of the Finance for Business funding which works well alongside investment from business angels and it becomes clear that the region is open for business.”