Growing through acquisition

Our client, a first-time business buyer, was a specialist in horticultural design and landscaping, based in South East England. After building one successful company, the client wished to grow through acquisition.

Being their first acquisition, the owner was looking for support for a well-organised and documented purchase and to advise on the financing arrangements.

Farringford Legal has handled my company transaction in a very positive and efficient way.

The team was very responsive and even when roadblocks came up they were able to deal effectively and quickly. Success achieved. Many thanks for being supportive. Highly recommended.

THE STORY OF OUR FIRST TIME business BUYER

After several years of successful trading, out client had set on a path of growing his business interests, intending to make several acquisitions over time and had successfully agreed terms with the shareholder of a company in North West England and had made arrangements for the necessary acquisition finance with the assistance of a broker.

THE CHALLENGE

As well as the client’s need to understand the company acquisition process (especially when combined with third party finance), the Seller wished to limit the scope of the financial investigations and due diligence prior to the sale. This had the knock-on effect of preventing the party financing the deal doing its due diligence, which could only be done after the acquisition. Luckily the company had a good level of cash reserves which were used to lend monies to the Buyer to fund the initial acquisition, adding to the complexity of the deal.

It is extremely difficult for a first-time buyer to navigate the transaction process, in particular if a seller is driving a hard bargain and being particular about the process. Farringford Legal has a reputation for being supportive, patient and empathetic with first-time buyers.

Buyers will always need guidance to give them comfort that they are not doing anything unusual, being taken advantage of or creating unwanted legal risk. The client was lucky to be supported by a broker who was very hands on in the execution phase and the team of broker-lawyer-client presented a united front to the seller and their advisors to help knock down the hurdles to completion.

One of our most senior lawyers experienced in business sales became their main point of contact, supported by our trainee solicitor. The first task was to build a relationship with the client and establish their goals and talk them through what they would need to do, practically, to complete the purchase, what they might expect to happen, timescales and the different ways which this would be addressed.

THE RESULTS

The client was very pleased with the outcome. First in securing the purchase while minimising the impact of the limited financial due diligence, but also in being able to restructure the purchase to create initial cash for acquisition, pending finance. The seller was good to their word, and the post-acquisition due diligence was just as expected – no surprises! This was a great confidence boost for our client, as they are looking for the next purchase and are set on making a series of acquisitions. This experience has not deterred them – far from it.

We supported the client through to their goal and dealt with many twists and turns along the way [all at an agreed price]. We pride ourselves on having an empathetic approach to our clients and we knew keeping them calm was key and we did what we could to shield them from too much stress.