Case Studies
SOLE PRACTITIONER SEEKS TO RETIRE....
Company/Business
- A successful sole practice, built up over the last 40 years
- A portfolio of £140K general accounting fees
- 80 long standing clients, based in the home counties, Sussex and central London
- 3 loyal and wonderful staff members
Background
The practitioner wishing to retire retained Foulger Underwood services for expert advice and guidance, methods and strategy to find an acquirer.
Concerns
Open and honest from the start, his main concerns included:-
- Lack of local marketplace knowledge
- Finding prospective acquirers
- Assurance of a smooth transition of his clients across to the new company
- Continued employment for all his staff members
- Ensuring the new company was a culture fit
- Ensuring seamless transition of management and processes
Actions
Foulger Underwood initially held several face-to-face meetings with the client to establish his retirement plans, his position financially and personally and what he hoped for in terms of timescale and outcome. His staff, their remit and ambitions were covered in detail as well as the current client base, size, tenure and intent.
Provision of documentation to the client for completion was necessary to provide the framework for the executive summary. This allowed for a relevant research assignment to focus on the regions and contacts who may wish to consider a practice of this size. On completion, the list of potential acquirers was presented to the client and from this a 'short list' created with Foulger Underwood drawing up a summary of each acquirer before each meeting. As requested by the client, a Foulger Underwood consultant was always in attendance at all meetings. Through second-round meetings a preferred partner was selected.
Foulger Underwood then negotiated, on behalf of the client, even improving the deal during this process, increasing the multiple and shortening the pay-out period. Terms and conditions were drawn up by Foulger Underwood and circulated. Following agreement and signatures, the due diligence process began with Foulger Underwood acting as the 'go-between' both parties for ease of communication, handling all queries, answering any outstanding questions again on behalf of the client and supporting at all times until the completion date. The practice was legally signed over to the acquirer.
Outcome
The practice was successfully sold to a like-minded regional practice, multi-office, and the staff all retained.
Benefits
- A higher multiple sale than the industry standard at that time
- A shorter period needed for the practitioner to work
- Staff all retained
- An effective transition period - no clients lost in the following twelve months
