CP ADVISES ANOTHER WASTE AND RECYCLING SECTOR CLIENT – THE UK’S LEADING INDEPENDENT WASTE BROKERAGE ON ITS SALE TO RECONOMY GROUP
Our award-winning Corporate Finance dealmakers advised the Shareholders of UK Waste Solutions on their sale to Reconomy, a portfolio company of EMK Capital LLP, marking the team’s second high profile circular economy deal in the last 18 months.
Headquartered in Newark, Nottinghamshire, UK Waste Solutions Limited are sustainability consultants and managers who specialise in supporting clients across the hospitality, distribution, transport, facilities management, manufacturing and construction sectors.
Through its flagship Novati brand, it works with many well-known and highly respected brands, including Marston’s, Prezzo, Roadchef, Network Rail, CBRE and Birmingham Airport. The business has enjoyed significant growth in recent years and now has 3,500 customers.
The acquisition of this fast-growing, profitable business and the foremost independent waste broker in the UK includes all four of UK Waste Solutions Limited’s primary brands (Novati, AMA, Click Waste UK and Evolution) and its 160 employees. It further strengthens Reconomy’s market-leading position in the commercial waste sector as the biggest technology-enabled, outsourced resource management solution in the UK.
UK Waste Solutions Limited’s offering across a broad range of sectors and industries is highly complementary to Reconomy’s existing business, deepening its capabilities and footprint within this vertical to better service new and existing clients.
The transaction follows the acquisition of Denmark-based green-tech business Combineering in February this year. Reconomy Group recorded revenues of over £1 billion through FY 2022 across its 30 offices worldwide and is one of the UK’s largest and fastest-growing businesses operating in the circular economy, waste management and sustainability sectors.
Guy Wakeley, Chief Executive of Reconomy Group, said:
“We are delighted to welcome the UK Waste Solutions Limited team to Reconomy Group. It is a great fit with our business due to our shared commitment to developing closed loop solutions that will accelerate the shift towards a more circular economy. The transaction is consistent with our ambitious plans to grow both organically and through further acquisitions in the UK and around the world.”
Michael Benton, Managing Director of the Recycle Division at Reconomy Group, commented:
“UK Waste Solutions Limited has a track record of delivering an excellent outsourced service and will be a valuable addition to the Recycle Division at Reconomy Group. Its customer-led approach aligns perfectly with our values and deepens our capabilities. It increases our joint offering in the commercial, industrial and construction industry to deliver economic and environmental benefits for businesses, providing an unrivalled, added-value outsourced alternative.”
Max Kanda, Managing Director at UK Waste Solutions Limited, said:
“Reconomy Group’s commitment to innovation in the circular economy and well-established footprint across the UK market will strengthen our combined growth, as we will be able to offer a wider range of services to our joint customer base. We are excited to become part of one of the UK’s largest and fastest growing companies at a critical period for meeting the challenges of resource scarcity through technology- and data-led closed loop solutions as the adoption of the circular economy becomes increasingly central to how we do business globally.”
The Cooper Parry Corporate Finance team was led by Ben Rookes, Tom Summers and Alex Ydlibi. Legal support on the deal was provided by Kuit Steinart Levy LLP.
Tom Summers, Associate Partner, stated:
“UK Waste Solutions is a fantastic local business. The focus on sustainability solutions it shares with Reconomy makes for an exciting partnership and a combined outsourced business service offering that will support the UK’s transition to a circular economy. We are proud to have supported the Shareholder group and Management team through this transaction and wish both them and the business every success going forwards.”
We’ve just acquired successful London-based financial planning business, Future Perfect, to become part of the Cooper Parry Wealth family.
This latest deal comes hot on the heels of our recent acquisitions in the Tech & High Growth space. Firstly, ihorizon – one of the UK’s leading early stage accounting players, and secondly, Acclivity, a boutique advisory firm specialising in accountancy, tax and consultancy to entrepreneurs and high growth early stage businesses.
All three are high-quality, London-based, specialist firms. And all three deals will feed into our ambitious growth plans, taking our total headcount north of 540. We also became the UK’s largest accountancy B Corp earlier this year. Safe to say, it’s a very exciting time to be at CP.
Ade Cheatham, Cooper Parry CEO, said:
“It’s been an incredibly fast start to the year and we’re on a roll. This Future Perfect deal is another sign of Cooper Parry’s 100% commitment to size and scale through the PE-backed acquisition of high calibre firms – who are the right fit – to help drive our ambitious client-first growth.”
Stephen Jones, Cooper Parry Wealth CEO observes:
“Right from the first tentative conversations with Future Perfect, we realised there was a genuinely likeminded approach. A proper connection. Both firms share a very similar philosophy. As a result, the client experience should be very smooth from the word go.”
Sue Royle, co-founder Future Perfect, adds:
“We were really impressed by the dynamic culture and ambition to be a leading financial planning force in the UK. It’s clear that everything’s in place to deliver an enhanced experience for our clients. I can’t wait for this new chapter to begin.”
Nick Crowe, co-founder Future Perfect, notes:
“In recent years, we’ve had a good deal of interest from other businesses. We have always had some key non-negotiables. Cooper Parry Wealth ticked every box – and plenty more. They are well-established, credible and will provide our client base with a perfect new home.”
Hear from Stephen, Sue and Nick in the deal announcement video below:
30 years of successful deal making in corporate finance. That’s quite an achievement. We’re celebrating Andy Parker, one of CP’s leadership team. 30 years of flying the ‘Rebels of Accountancy’ flag.
We got Andy to sit down with Ollie Macildowie and Sachin Parmin two of the new generation of Corporate Finance. They talked about the past. And of course, his love of rugby and cycling.
Here are some golden nuggets from their conversation. They might tempt you to watch the full video. Just 14 minutes long. Well worth a watch.
What’s changed?
Andy pointed out that one big change he’s seen over the past 30 years in the deal making world is simply how people are. Over are the days of the ‘suited and booted’ uniform. Long gone are the shirt, tie and red braces. The very fact that their conversation takes place sat on settees in casual clothes highlights the change in the office environment.
Technology is another big change. Back when Andy started out there was no internet. We’re talking pre-computer. No excel spreadsheets or google. Research had to be done the old-fashioned way. Physical data rooms filed with box files and print outs of business records. It was all much more time consuming. Analysis and modelling for deals were driven by broader assumptions and didn’t benefit from the data driven (sometimes spurious) accuracy we see today. Interestingly, in Andy’s view the actual timetabling of deals hasn’t changed much. Though people tended to be a little more intuitive on deals, looking for the big picture, because access to information wasn’t as readily available as it is today.
Favourite decade?
Ollie and Sachin were interested to know which decade was Andy’s favourite. The 90s. Work hard. Play hard. Major developments over the past 20 years have made work different – maybe a little less spontaneous.
The Tsunami of change the internet brought at the end of 90s had a significant impact.
A positive difference is that there’s no longer a ‘making it up as you go along’ approach. Deal making and corporate finance has become much more sophisticated. It’s now data and process driven. It relies less on the individual “rain-maker” forcing things through by dint of personality. Though business relationships still matter. People deal with people.
The bursting of the dot.com bubble at the start of this millennium had a big impact on the corporate finance world. More recently since the global financial crisis, low interest rates across the developed world have cause cash to be poured into private equity, with investors seeking better returns. The mergers and acquisition markets have been stimulated in our part of the economy, the mid-market. There are more players in the market with lots of private equity investors competing with strategic buyers and each other.
Even after 30 years in the sector Andy still gets that buzz. Learning new things all the time. Working with entrepreneurs. There might be similar situations but every deal is different.
The constants
Management. Management. Management. It’s fundamental. And it’s here to stay. The fundamentals of what makes a good and attractive business haven’t changed. It’s all about management. The sectors which continue to be attractive are frequently subject to regulatory change and demographic change – which creates opportunity. Healthcare has been a growth market decade after decade: people are living longer needing more care, more medication and devices to help them. Business services (still the dominant part of the UK economy), particularly where tech-enabled, remain attractive for deal-making. Technology, whether hardware, software or services is always in demand across deal markets as it facilitates or drives change in the economy.
A team of all shapes and sizes
It’s no secret that Andy is passionate about sport. He completed the 21 gruelling stages and 3,470km of the Tour de France 2021 a week ahead of the professionals.
Andy believes rugby is the ultimate team sport. Rugby, like dealmaking, is a whole team business. As Andy says “Teamwork is central. Everyone has got a role. Everyone needs to play their role. If everyone plays to their best, then the team works. Every successful deal needs people to be doing different things to the best of their ability.”
Good rugby teams have great leaders who stand up and lead in times of difficulty and that’s the same for deals.
Know your client
A final piece of advice from Andy. His advice to clients. Be honest with yourself and with us about your real objectives. Everyone needs to be on the same page. There are twists and turns in deals. We need to focus on what is really important to the client. For those starting out in Corporate Finance Andy’s final golden nugget is have integrity. Do what you say you’re going to do. Keep your promise. Don’t go after short term wins. Trust is key.
Here’s to the next 30 years in Corporate Finance for Ollie and Sachin.
After continuing their impressive deal-making record through the pandemic, Cooper Parry Corporate Finance have welcomed a new Deal Originator to the team.
Jemma Bailey joined us on 2 November, and her role is all about connecting with companies, developing new relationships and building our pipeline of future work across sectors where our deal credentials and buyer interests lie.
They include Health & Social Care, Technology, and Tech-Enabled Business Services in particular, and thanks to her background in recruitment, Jemma has tons of experience in building long-term relationships with targets and proactively sourcing leads.
NO TIME LIKE NOW
Recently, we’ve been seeing business owners reviewing their exit or investment plans, which in many cases has been accelerated by genuine concerns around potential Capital Gains Tax rises in the Spring budget.
De-risking, by either selling their business or taking on a private equity partner to share the risk, grow and bank some cash is high on the agenda for many.
Many companies have diversified, demonstrating their innovative and entrepreneurial nature, so may be looking for investment to grow organically or by acquisition, too.
So, with two deals completed in lockdown, one deal exchanged and two imminent completions, Jemma arrives at the perfect time to help our Corporate Finance team go from strength to strength.
Jemma said:
“I’m really excited to be joining Cooper Parry Corporate Finance. The culture and business model are hugely attractive to me, and I cannot wait to be an integral part of their ambitious growth plans.
“I am really looking forward to connecting with companies and building a pipeline of future deals across sectors. I believe my skill set will enhance the Corporate Finance team and I am excited to help this business grow from strength to strength.”
Laura Clarke, Origination Director at Cooper Parry Corporate Finance, added:
“Over the past 3 years, CPCF has built a fantastic Origination team and Jemma’s appointment is an exciting step to accelerate our growth.
“Jemma will be working closely with our team of analysts to provide relevant and interesting market and deal information for business owners in sectors we know well. In her previous roles, Jemma has built an impressive contact base, so we look forward to her building long term relationships with entrepreneurial, fast-growing businesses in our chosen sectors.”
With many of our clients experiencing difficulty in accessing funding, we thought we’d share the observations of our CFO, James Parnell.
“I’m hearing and reading similar things that accessing the loans is proving more difficult than everyone hoped for. Privately, I’ve also heard directly from banks that they too are finding it harder than they expected to push loans through the system for their customers (more paperwork and full credit committee still required).
In my view, the best place for people to start is the British Business Bank.
This gives a decent overview of the scheme, who’s eligible with useful fact sheets and so on. It also has links to the 40 accredited banks that are taking part. Clearly, the actual relationship is with the lender and the loan is partially guaranteed by HMG in the event of default by the customer. If there is a default, HMG will guarantee 80% of the lender’s loss after all recoveries – i.e., the banks will ALWAYS lose out on 20% of what they’ve lent if the customer defaults. If a customer has existing borrowing or an overdraft facility, and security is in place already, then even the 20% exposure is proving tricky for some banks. This is why we’re also reading about Personal Guarantees in the press recently.
The other complication is that if a “normal” loan is possible because the business is stronger or has unused security, then the onus is on the bank to lend normally rather than issuing CBILS loans. That naturally will take a bit longer and is likely to annoy customers because then they’re back in for any fees and first 12 months interest (which the Government funds under CBILS)!
So, yes, it’s a fairly muddled landscape. And it’s one that’s changing all the time. Watch this space.”
For more information, get in touch with James Parnell.
Funding is the key in the ignition of any business chasing success. But it can come at a very high price if you choose the wrong investors.
Much like a marriage, a strong relationship will see both parties flourish and succeed together, while a sour one will leave you asking, “what the hell was I thinking?”
Whether it’s angel investors or venture capital you’re looking for, finding the perfect investor for your business, with the capital and the knowledge to take it to the next level, is critical. The first step: knowing where to look.
Where to find investors
Explore your connections
Put yourself in an investor’s shoes. Every day your inbox is swamped with messages from budding entrepreneurs who all want the same thing. So, are you more likely to give your money, time and trust to a) a cold emailer, or b) someone who’s been introduced by a person you trust?
Do you know a successful entrepreneur who could point you in the right direction and vouch for you? If so, arrange a meeting with them and show them why your business deserves investment.
If your closest university has a reputable business program, have you asked them about their network of angel investors, venture capitalists and entrepreneurs?
And if you know another company in your industry has found an investor, can they give you any recommendations? Angel investment networks often specialise in certain industries, meaning this is a great way to make the right connections. And they specialise in certain locations too, such as Nottingham’s new angel investment network, Minerva.
Make yourself visible
Industry events are a hotbed for investments. They attract a wide array of investors and they’re your opportunity to be in the same room.
Set out to prove you’re market ready. Go with a clear idea of the type of investment you need, and make sure you’re equipped with a polished elevator pitch and facts and figures that you can share comfortably. Talk to as many investors as you can, ask lots of questions about them, how they operate, and what they’re looking for from you, and build on the relationships that are the right fit.
A strong social media presence will go a long way too. Be sure to spread the word that you’re looking for investors. And if you can show these investors that your product or service has a following, with support and testimonials from customers, their risk goes down, and your chances of securing better terms from better investors goes up.
Online investment platforms
Online platforms have revolutionised the way entrepreneurs connect with investors and raise capital. On AngelList, for example, you can use the search tool to find nearby angel investors, seed fundings and venture capitalists that specialise in your industry.
Crowdfunding has become an increasingly popular source of funding too. Platforms such as popular UK site Crowdcube give entrepreneurs access to small amounts of capital, sourced from large numbers of people. It’s not just angel investors and venture capitalists you’re reaching here, it’s the public too. They can invest as little as £10 in businesses, and the rewards these investors receive can be nonequity based, such as products.
What to look for when finding investors
It isn’t locating and contacting investors that can make fundraising an uphill battle. It’s finding the right investor for your business. Entrepreneurs often speak to over 50 investors before they secure funding, so you’ll need to choose between a long list of people to find the perfect match.
It’s a partnership, not a transaction
An amazing idea and pitch lay the foundations for your success, a quality investor helps it take shape. But it’s not money that distinguishes a good investor from a bad one. This is a partnership, not a transaction, and it’s all about the value they can add on top of their cash.
So ask yourself:
- Do you share a mutual connection, respect and values? Would you go to the pub with them? Because this is a long-term relationship, trust and chemistry are paramount.
- Have they worked in your industry before? What can they teach you?
- Who could they introduce you to that could benefit your business? Finding an investor that can help you secure your next round of funding frees up your time to focus on growing your business. You might also look for someone who knows a marketing expert, for example. The bigger their network, the more potential clients, future founders and team members you’ll have access to.
- Have they grown a business before? What’s their track record like? How can they help you manage risks? Investors carry out comprehensive due diligence, and so should you.
- How much time will they have for you? If they have a huge portfolio, sure, they’re successful, but how much guidance and attention will they be able to give you?
Be patient, persevere and choose wisely
Choosing the right investor is arguably the most important decision you’ll make as an entrepreneur, and once you’re working with someone, getting out can be very tricky.
Great ideas get funded, regardless of the economic climate. But even if you’re cradling the most ground-breaking, innovative product or business idea, be prepared for investors telling you your baby isn’t all that pretty.
That means plenty of “no’s”, and even when you start to hear “yes”, you need to make sure you’re taking an investment on favourable terms, from an investor with the expertise to realise your potential. Then, you’ll be able to start shifting up the gears together.
We’ve continued our strong summer here at Cooper Parry Corporate Finance, completing four deals in the last two months.
These deals all occurred in two of our key sectors: business services and technology. Geographically, they’ve been spread across the Midlands, and they’ve also included the first deal out of our new London office in Moorgate.
We’ve added to our proven track record of working with private equity with two high profile deals: the buyout of Solihull-based software provider Phoebus Software Limited by NorthEdge Capital and the buyout of Simply Conveyancing, backed by Livingbridge.
Following on from the sale of building compliance software business William Martin last year, we’ve advised on the sale of Inflexion private equity backed Alcumus Group’s building compliance software division to management.
The other deal during this period saw us provide corporate finance advice in the merger between major independent property firms Fisher German and Vine Property Management, creating a £41m turnover group.
Andy Parker, Head of Cooper Parry Corporate Finance, said:
“Despite the drop off in activity seen in the mega-deals market caused by economic uncertainty, private companies and mid-market private equity investors can still make acquisitions with lots of equity and debt funding readily available to invest in quality businesses with clearly defined strategies and strong management teams.”
Our Partner & Head of Corporate Finance, Andy Parker, shares his thoughts
Theresa May has echoed a sentiment I often express as a corporate finance deal leader: “Until the whole deal is done, no deal is done”. Whilst there are pieces of a deal that don’t quite fit, that haven’t been fully negotiated, parties can, legitimately reassess parts that have been agreed because everything is inter-linked.
Brexit has many moving parts like an M&A deal: price, terms, legal niceties, several parties (I am glad I don’t deal with 27 others!) and loads of emotion!
At the weekend, there were hints that May has manoeuvred the chess pieces to allow the United Kingdom to have a trade deal with Europe like Canada, keep the whole of the UK in a customs relationship with the EU and no need to have a hard border in Ireland. All she has to do now is to get her party to agree and get it all through the House of Commons!
Uncertainty is the challenge for some
The uncertainty over Brexit has impacted on the UK economy with both the Office of Budget Responsibility and the Chancellor reducing growth forecasts for 2019 to the lowest level since the end of the Global Financial Crisis – 1.3%. Some businesses that we have met have found the uncertainty the biggest challenge. Decisions to invest in new facilities or recruitment have been delayed by some and others have been cautious over long-term contracts they have been willing to take on.
Corporate M&A remains strong
The one thing we have not seen tail off is corporate M&A. We continue to see investors from overseas, particularly North America, see the UK as an attractive place to buy. Brexit-driven devaluation of sterling makes UK assets look cheap and, whilst Brexit may have caused a low-growth economy, the UK is still the fifth biggest economy in the world and a country in which business and the rule of law are respected.
In the next few months, we may see decision making slow for some as they get nervous over the future but most entrepreneurial businesses will, in my view, accept the challenge, adapt their business models and make a success of the future – whatever Brexit throws at them.
