UK manufacturing business for sale?
Discussion
Hi all,
I'm a long-time automotive engineer and project manager who has been researching about UK business acquisition with the intent to potentially take ownership of an established business through equity and debt. I've had a couple of conversations with some smaller precision machining shops but after making enquires on the level of debt that can be financed with capital providers, I need to set my sights higher in terms of business valuation for it to be 'worth it' for the loan provider. As the initial conversations were with friends of friends with small operations, I'm now casting the net wider and this is providing it's own set of challenges.
Have any of you gone down this route with success or failure and have any valuable feedback? How did you managed to find the business to enquire about? Has propeitary outreach been a good route?
Thanks!
I'm a long-time automotive engineer and project manager who has been researching about UK business acquisition with the intent to potentially take ownership of an established business through equity and debt. I've had a couple of conversations with some smaller precision machining shops but after making enquires on the level of debt that can be financed with capital providers, I need to set my sights higher in terms of business valuation for it to be 'worth it' for the loan provider. As the initial conversations were with friends of friends with small operations, I'm now casting the net wider and this is providing it's own set of challenges.
Have any of you gone down this route with success or failure and have any valuable feedback? How did you managed to find the business to enquire about? Has propeitary outreach been a good route?
Thanks!
Hello,
Exciting times for you, enjoy the ride !
Yes I have done it. I owned a UK manufacturing business and brought another business, incorporated it into the original business, and grew the businesses.
Worked well for me, but involves lots of hard work.
About to embark on a new venture helping people source company acquisitions, scale them up, and at a point sell them.
Please do reach out to me.
Exciting times for you, enjoy the ride !
Yes I have done it. I owned a UK manufacturing business and brought another business, incorporated it into the original business, and grew the businesses.
Worked well for me, but involves lots of hard work.
About to embark on a new venture helping people source company acquisitions, scale them up, and at a point sell them.
Please do reach out to me.
Not bought or sold but in terms of finding a viable target business, I do not see any conflict or problem with a direct, open approach. You would still need an adviser to get a deal done, but the initial approach could be personal.
There are sundry business brokers and sales experts who may have firms looking to sell. You are going to need a decent accountant and a local one to you might even know of firms looking to ext and/or sales brokers you can talk to.
Good luck.
ETA: Can/will you say what size of deal is viable?
There are sundry business brokers and sales experts who may have firms looking to sell. You are going to need a decent accountant and a local one to you might even know of firms looking to ext and/or sales brokers you can talk to.
Good luck.
ETA: Can/will you say what size of deal is viable?
JayCole said:
Thank you all for the recommendations. I'm aiming around the £700k EBITDA region at this stage and will contact some local accountants to get some more information.
Talk to them about current UK EBITDA to value ratios. I have no idea where they are for that type of business at this particular point in the economic cycle (tornado?). I'm guessing 4 or maybe even 3.It's tangential to the area I work in, but a decent starting person to speak with for some recommendations of business brokers/ corporate finance contacts in the specific sector and/or region is Douglas Lawson at mark to market. If you google him you should be able to find an email address.
Firstly, check that you can definitely afford it and are able to put sufficient skin in the game yourself to unlock the other finance providers.
Have you considered an MBI or MBO? This massively de-risks it, you may be able to get vendor finance and is more likely to happen.
You can provide a solution for the owner manager that doesn't currently have succession plans and allow them to extract cash at CGT rates.
If of interest, I'd suggest putting a one-page summary and sending to the small CF/accountancy/legal practices in your respective area + recruiters. Then be prepared for lots of meetings with your basic slide deck, including funding if ideally progressed.
Have you considered an MBI or MBO? This massively de-risks it, you may be able to get vendor finance and is more likely to happen.
You can provide a solution for the owner manager that doesn't currently have succession plans and allow them to extract cash at CGT rates.
If of interest, I'd suggest putting a one-page summary and sending to the small CF/accountancy/legal practices in your respective area + recruiters. Then be prepared for lots of meetings with your basic slide deck, including funding if ideally progressed.
An ex-colleague runs a company that works for buyers and locates and approaches specific types of businesses for its clients. It seems to be very successful and growing rapidly. It might be worth a look/convo. Talk to John Braithwaite at Unloq Ltd, he's very knowledgeable and helpful. I am afraid I don't know much more than that but hope that helps.
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