A way out for struggling owner managers
3/10/2008
Opportunistic entrepreneurs looking to expand through acquisition are proving to be the light at the end of the tunnel for many struggling owner managers, according to Stephen Fern, director at LC Corporate Strategies, the turnaround arm of national top 10 recovery outfit Leonard Curtis.
He said: "Businesses with healthy working capital are acquiring troubled competitors at lower market values. Similar to Lloyds TSB being in a position to soak up one of its largest competitors, in the small and mid-market we are seeing the same trend as some companies feel the pinch of the economy more than others."
The firm currently has a database of would-be acquirers with circa £10m to invest in otherwise viable businesses, which are experiencing cashflow pressures due to soaring energy and raw material costs coupled with a reduction in available credit. It has named the initiative Acquire, to market the business match-making service to owner managers and directors of struggling small and mid-sized enterprises (SMEs) across a range of sectors, including manufacturing, recruitment, haulage and retail.
Fern continues: "A key option for turnaround is to sell the business to a trade buyer. Even if a turnaround proves impossible, once a company goes into administration, we are always keen to identify a buyer to allow the business to trade on under a different guise. In this way, we are often able to safeguard jobs and creditors are more likely to be satisfied.
"For many owner managers, business is becoming an uphill struggle. Whether they are looking to retire or are ready to become a part of a larger operation and benefit from:
- Exit route from the business
- Added management knowledge and experience
- Cost savings and synergies
- Securing customer base or supply chain
- Additional funding and working capital investment
- Consolidation of primary functions and activities
- Operational improvement and efficiencies
We have a ready supply of acquisitive entrepreneurs."
Those interested in registering their interest to be matched with a potential purchaser, should visit http://www.corporatestrategiesplc.com/acquire
