“McBrides helped me acquire the company, supported me whilst it developed into a very successful business and advised me how to very effectively incentivise two key employees. When I decided to sell, they found a buyer, secured a great price, helped me through the sale process and structured the sale of my shares in a highly tax efficient way. I would be delighted to recommend McBrides to any owner managed business.” Jeff Foot
L&G Forest Products Limited ( “L&G” / the “Company “ ) is a timber merchant and importer supplying quality timber based products to the construction industry.
business challenge
Following a recommendation, one of the shareholders of L&G approached McBrides in 2000 to deal with 2 specific challenges:
- Assist in the buyout of a shareholder
- Provide ongoing business advice to assist in the growth and ultimate sale of the Company within the next 10 years
how we helped
McBrides provided a report to the owner explaining how to structure the buyout of a shareholder tax efficiently. The recommendations were accepted and McBrides structured the buyout through a company purchase of own shares arranging and dealing with all the paperwork and formalities.
Whilst the accounting system was already in excellent shape, our team was able to provide additional support to the bookkeeper to help identify key management reports to be made available monthly and to implement financial projections. With reliable management information in place, we were then asked to provide further business advice. The management team was key to growing the business. We recommended a share incentive plan to ensure the team was focused and working with the owner to grow the Company. We also set up an Enterprise Management Incentive (EMI ) scheme for two key members of the management team.
The growth in the Company over the next 2 years justified the existence of the EMI scheme and enabled the owner to focus on the next stage of the Company’s development. The business was in need of new premises to accommodate its growth. The owner found the ideal premises and McBrides provided advice on its purchase – ownership structure, tax efficiency and funding.
The move to new premises was the catalyst for increased growth which meant the Company was now very much an attractive proposition for a potential acquirer.
Exit planning had been on the agenda for some time. The Company was now in the right position for a disposal. McBrides were instructed to assist in the sale of the business to an organisation that could build upon and continue the growth that had been achieved already.
it all adds up
A full sales mandate was given to McBrides – a buyer was found, transaction negotiated and structured tax efficiently to achieve maximum possible value. The transaction completed in 6 months. The Company is now a subsidiary of a national quoted entity in the builder’s merchant sector.
