Corporate Finance Guide 2021 CORPORATE FINANCE GUIDE SPECIAL | CORPORATE
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01/06/2021 15:30 15:30 01/06/2021 01/06/2021 1 1 cover.indd cover.indd Guide Guide Finance Finance Corporate Corporate MIDLANDS BUSINESS INSIDER www.midlandsbusinessinsider.com JULY 2021 JULY midlands businessinsider WEST ™ MIDLANDS insiderEDITION VOL.29 NO.7 £10 JULY 2021 West Midlands Mayor What does business want from Andy Street’s second term? CITY OF CULTURE CITY OFCULTURE Wolverhampton The new home of green construction | SMEGUIDE Mental health | MENTAL HEALTH HEALTH MENTAL Helping a colleague on the edge | RESIDENTIAL AWARDS RESIDENTIALAWARDS | CORPORATE FINANCEGUIDESPECIAL CORPORATE Guide Guide 2021 Corporate Finance Corporate MIDLANDS | CIRCULARECONOMY FIREDHOW A YEAR AS CITY OF CULTURE UP! IS VOL.29 N VOL.29 SPARKING GROWTH IN COVENTRY O 7 MBI July 2021 cover MASTER.indd 1 02/06/2021 15:00 Optimising outcomes for our clients no matter what their destination DLA Piper has been the No 1 M&A law firm, both in the UK and globally, for each of the past 11 years. Trusted adviser to: Put simply, we do things that other law firms cannot. Times 2 SISTERS FOOD GROUP may change, but our qualities do not. Our clients trust us with Advised on the GBP246m sale of part of Fox’s Biscuits to their most important, strategic and transformational M&A and Ferrero Group. ECM transactions. We use our market and sector intelligence and unrivalled deal execution experience to drive and obtain NOBLE GROUP optimal outcomes for our clients, no matter what the deal type, Advised on the sale of chilled dessert brand Gü to Exponent the transaction process, the geography or the counter-party. Private Equity. We look forward to helping you reach your destination. PANGAEA LABORATORIES LTD Please do get in touch. Advised on the sale of the global beauty business Noel Haywood (owner of the Medik8 skincare brand) to Inflexion Private Equity. Head of Corporate, Birmingham +44 (0)121 262 5953 DECHRA PHARMACEUTICALS PLC [email protected] Advised on its accelerated bookbuild (ABB) placing of 5,132,500 new ordinary shares raising GBP133.4 million. Charles Cook SCAPA GROUP Head of Corporate, UK Advised on their GBP412.6 million takeover by Schweitzer-Maduit +44 (0)121 262 5808 International, Inc [email protected] MEDICA GROUP PLC Advised on secondary fundraisings for Medica (Main Market) raising approx GBP16 million Copyright © 2021 DLA Piper. All rights reserved. | JUN21 | A09985-7 MIDLANDS Corporate Finance Guide 2021 POWERING THROUGH THE PANDEMIC Pandemic, Brexit, lockdown – it has been the most challenging year of our lifetimes. Yet after the initial shock, Midlands dealmakers recovered quickly and within weeks were back to some of the best trading volumes in a decade. Now, with new funds and advisers setting up shop, the Midlands is strongly entering the recovery phase. Over the next few pages we show how the region’s dealmakers fought back against adversity 350 he world may have stopped, but 350 Tdealmaking didn’t. MIDLANDS “It’s been a strong year for deal making DEALS in the Midlands,” says Simon Ward, OVER FIVE 300 300 YEARS partner at Springfield Corporate Finance. “Given the uncertainties of the pandemic in March and April, the resilience and 250 innovation shown across the market has 250 been extremely impressive. There were undoubtedly some sectors that were hit NUMBER OF DEALS 200 hard, but others were able to adapt quickly.” 200 “Dealmaking over the past year has been Source Experian V-shaped: a short, sharp down-stroke when 150 we first went into lockdown followed by a 150 longer, but uninterrupted, up-stroke since,” Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2016 2017 2018 2019 2020 2021 CONTENTS 13 International deals 23 Midlands Dealmaker Awards 2020 5 The rise of the Midlands 15 The rise of equity 28 Midland Deals May 2021 11 No shortage of sellers 15 Green dealing 13 Sectors 19 Advisers and lawyers: specialisms and sectors insider MIDLANDS CORPORATE FINANCE GUIDE 2021 | 1 CFG p1-21.indd 1 02/06/2021 15:13 • • • • • • Local Connections. Global Influence. www.squirepattonboggs.com CFG p1-21.indd 2 02/06/2021 15:13 MIDLANDS Corporate Finance Guide 2021 • Gymshark • A US private equity firm took a significant stake in fitness apparel business Gymshark in a move that • valued the Solihull-based business at more than £1bn. New York- headquartered General Atlantic snapped up a 21 per cent holding in the business founded by Ben Francis in 2012. Francis, who increased his • stake to more than 70 per cent, said. “I believe Gymshark has the potential to be to the UK what Nike is to the US and Adidas is to Germany. We adds Charlotte Thornton-Smith, corporate than abandoned, and many of those that will use this partnership to get even partner at law firm Harrison Clark were scuppered by the pandemic were closer to them on a truly global Rickerbys. “We didn’t see the second more than replaced by businesses seeing • scale.” PwC, Gateley, RBC Capital lockdown affect the completion of new opportunities, particularly acquisitions, Markets and Freshfields Bruckhaus transactions. Last year was a strong one in ‘the new reality’. Deringer advised. for dealmaking.” “A number of transactions were pulled “The transaction valued Gymshark These are more than just cocky assertions. and business owners and management in excess of £1bn, which placed it Figures from business information teams concentrated on ensuring their • on an exclusive list of just 25 British group Experian show that, despite fears businesses could access the emergency companies to have secured unicorn that the economy was set to all but crash funding and financing available,” says Mark status since 2001 – a feat achieved during 2021, dealmaking in the Midlands Hughes, partner at Browne Jacobson. in just eight years,” said Tom came back to its former levels of activity “But as the year went on, transaction Durrant, head of the corporate team in a matter of weeks. Whereas recovery in volumes picked up and the end of year at Gateley. “The deal was complex M&A from the credit crunch of 2008 took saw our busiest ever period.” and involved an enormous amount about three years, revival from the first “After a strong first quarter there was of work. It required a pre-completion lockdown took less than three months. inevitably a hiatus, as both buyers reorganisation of the group as well According to Experian’s figures, the and sellers took stock, but we saw activity as vendor due diligence, dealing initial stage of the pandemic clearly surge again in the third quarter,” says with the issue of long-term caused a major fall in the number of deals Martyn Pilley, of corporate finance boutique incentive shares and acquisition transacted in the Midlands. As the first Cattaneo. “We saw strategic purchasers and investment work. A total wave of coronavirus hit in the second wanting to press ahead with transactions of 20 of our lawyers advised on the quarter of 2020, the number of deals to prevent the pandemic halting their pro- deal, including 13 partners. Despite completed in the Midlands fell to 163, the gress, seeing the opportunity to bed them the challenges of global remote lowest total since the credit crunch, from down and emerge in a stronger position. working during the first lockdown, 266 the previous quarter. “The deals that didn’t happen were the which caused significant challenges, However, the regional market came back ones where the pandemic had such an the transaction was completed very quickly, to 222 deals in Q3, followed impact on trading that valuations became Local Connections. Global Influence. within ten weeks. by 256 and 257 in the subsequent two impossible to justify until visibility was www.squirepattonboggs.com quarters. Most deals were deferred rather possible on the route out of the pandemic.” insider MIDLANDS CORPORATE FINANCE GUIDE 2021 | 3 CFG p1-21.indd 3 02/06/2021 15:13 Making it happen, side by side Acquisitions / Management Buy-Outs / Re-structuring / Investing for growth With an experienced team of decision makers right here in the Midlands, we can provide the funding to support a breadth of business situations – from £1m - £25m. Selected Recent Transactions Leverage Loan Asset Based Lending Leverage Loan Asset Based Lending Unitranche Smiths News Esterpet Ltd BCF Equity Partners / United Tooling WestBridge Capital / Media Distribution Recycled Packaging Hydromarque Ltd Solutions Bespoke Health & £U/D £9m Manufacturing Wholesale Social Care Ltd £1.4m £10m £U/D Contact us today 0330 123 1740 [email protected] CFG p1-21.indd 4 02/06/2021 15:13 MIDLANDS Corporate Finance Guide 2021 “The M&A market is buoyant, with record quarters not seen since before the financial Making it happen, crash in 2008,” adds Roger Buckley, MIDLANDS DEALS partner at accountancy BDO. “The market BY TYPE is cash-rich, whether that’s from acquisitive companies, or eager investors. The strong side by side appetite for deals has surprised many, but the market is playing catch-up. Companies l Acquisition 552 Acquisitions / Management Buy-Outs / Re-structuring / Investing for growth and investors are not deterred by l Development uncertainties triggered by Covid-19. After Capital 121 the hiatus in Q2, 2020 there’s a desire to l Refinancing 97 continue on a positive growth trajectory.” l Investor buyout 29 Strategic purchases clearly played a l With an experienced major role throughout the year to 1 April. Buy-ins & Buyouts 94 team of decision According to Experian, there were 552 l Other 47 makers right here in acquisitions of Midland businesses over l Rights Issue 22 the year, accounting for 58 per cent of all the Midlands, we can deals.