Two months. Two new projects.

Castle Corporate Finance - Our window on the world.

Time certainly does fly when you’re having fun – Castle’s new CF Manager, Alex Nursey, reflects on his first couple of months in his new role.

“It’s been two months since I joined the team at Castle. Whilst it certainly would have been easy to feel slightly overwhelmed starting remotely in the midst of a pandemic, my experience has fortunately been quite the opposite – I already feel like part of the furniture.

It has been beneficial to join in the middle of a busy period, and just as some major projects are kicking off. So far, I’ve predominantly been working on two deals, the first being the major re-financing for a client to source a more flexible debt package that not only provides the business with a source of finance for its future working capital needs but also some additional cash headroom as they seek to undertake a number of strategic acquisitions. It’s been interesting understanding how the board are seeking to “future-proof” the business by acquiring strategically important targets in order to diversify the group’s already impressive customer base and by adding niche products and services to its portfolio.

The second project is the disposal of a staffing agency division from a privately owned and highly respected healthcare provider. We’ve literally just pressed the button on this engagement and are currently approaching a shortlist of potential acquirers to gauge appetite. We are confident in achieving a competitive bidding process in the coming weeks which will hopefully secure a great deal for our client.

Castle has been seeing further opportunities across a variety of sectors including agri-tech, recruitment, food manufacturing, specialist healthcare and life sciences since the turn of the year, demonstrating that no matter the size of the business or the sector in which they operate, owners are still keen to adapt and push on with their strategic ambitions, notwithstanding the current situation.

There was much uncertainty in the lead up to the Spring Budget as to how the Capital Gains Tax regime might be altered, meaning we experienced an increase in M&A activity as owners sought to crystallise their hard work before any changes potentially came into effect. With no changes announced, we are optimistic that this will give entrepreneurs sustained confidence to continue to invest for growth.

Owners have also been keen to reward loyal employees and secure tax efficient succession planning and we have found that Employee Ownership Trusts (EOTs) are great vehicles to enable this sort of strategy. Castle has extensive commercial and project management experience of EOTs, having advised on a number of these transactions over the last 18 months.

We also expect many businesses to require additional funding this year, particularly those more exposed to the short-term economic shocks of the pandemic. Others will require additional facilities to capitalise on growth opportunities that arise as head towards what many are predicting will be a strong bounce back by the UK economy from the second half of 2021.”

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4th March 2021

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