Our Corporate Finance advisers predict spike in activity

Our Corporate Finance team have reported increasing demand from management teams exploring buyouts, with several large and overseas groups considering divestment as they reassess business strategy post COVID-19.

As one of the largest advisory teams in the North East, having advised on over 75 MBOs since 2001, the team expect this to continue as there is a substantial amount of equity and debt finance available to fund these transactions.

Lee Humble, our Associate Partner, commented:

“The North East has some superb management teams who have navigated recent volatility with great skill and now find themselves in a position where the owners or parents no longer see their business as core.

Despite the backdrop, liquidity does exist in the market with equity providers in particular keen to support buy out activity, so the opportunity is there to take advantage of temporary reductions in valuations and the availability of finance to purchase businesses.”

As a former business owner who has been through buy outs previously, Lee added:

“Moving forward into the second half of 2020, there are certainly going to be more opportunities for management to buy their companies from the shareholders. They represent good value for money as there is not always a strategic trade buyer option available for every company. 

Also, for larger Groups wanting to offload some of their assets in order to realise money and focus on core activities, offering management to explore an MBO becomes a viable strategy.

The opportunity is there to take advantage of temporary reductions in valuations and the availability of finance to purchase your business, and our vastly-experienced team would be delighted to assist you.

The buy-out process can be daunting, but with a defined process and pre-agreed form and timetable for negotiation, such a transaction can be a great means to unlock value for both business owners and management teams.”

Contact us

For more information, please contact Lee Humble on 0191 285 0321 or email lee.humble@taitwalker.co.uk.