Business Acquisition Financing

Do you require £2m or more financing to acquire another business? Our business acquisition financing service focuses on articulating your buy-and-build strategy to generate funder interest and confidence. Our financing expertise spans debt, equity and everything in between. Put simply, we present your acquisition strategy to the right funders, in the right way and negotiate the best terms for you, giving you the best chance of buying another business.

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TRUSTED BY businesses across the UK

WHAT IS BUSINESS ACQUISITION FINANCING?

Business acquisition financing is sought for the specific purpose of buying another business. Whether it’s a competitor or a business in the supply chain, acquiring a business can be a quick way to achieve scale and strengthen your competitive advantage. But the process to secure acquisition financing can be time consuming, stressful and costly if you don’t know what you’re doing.

WHO DO WE WORK WITH

We work with growing businesses that require in excess of £2m of financing to buy another business. Our clients’ needs will typically be for sophisticated business acquisition finance products such as cash flow based lending or private equity investments. Our value lies in helping clients access funding that relies on funder confidence in future trading opportunities and cashflows of the combined entity post-acquisition.

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BUSINESS ACQUISITION FINANCING – HOW BUSINESSES GET IT WRONG

We can confidently say that every client we engage is not prepared to take their business acquisition proposal to funders. Being unprepared for funder scrutiny can significantly reduce, or entirely remove, your chances of getting the financing to buy another business. Remember: first impressions count.

The typical things that can erode funder confidence and jeopardise your chances of securing finance to buy another business include:

  • Poorly defined business acquisition and financing strategy;
  • Over-estimating what the acquired business will deliver in cash terms;
  • Overlooking hidden risks that may come with the target business;
  • Poor articulation of your value proposition and value drivers;
  • Inconsistent, incoherent or incomplete financial information;
  • Weak financial modelling and incomplete forecasts of existing and/or combined organisations;
  • Presenting a biased view of existing business performance and risks;
  • Financing proposals that exclude critical information that funders expect to see.

BUSINESS ACQUISITION FINANCING – HOW TO DO IT RIGHT

To successfully secure financing to buy another business, you need to achieve five fundamental objectives:

  1. Create a robust business plan for the combined entity that stands up to funder scrutiny.
  2. Articulate that plan in a balanced and coherent way that funders can understand.
  3. Approach the right partners to fund your plan as part of a competitive process.
  4. Demonstrate deep knowledge of the acquisition target and its cash flows.
  5. Defend value in due diligence and close your transaction professionally.

Funders need to have confidence in you and your business acquisition plan from the beginning to the end of the process. First impressions matter and you must never approach the funding market until you are truly ready to acquire the business. We can help you get ‘market-ready’ to deliver funder confidence and secure the financing you need to make your acquisition happen.

BUSINESS ACQUISITION FINANCING ADVISORY SERVICE

By using our business acquisition financing service, our funding specialists add value by challenging your business acquisition plan and optimising your financing proposal before you take it to the funding market. We build funder confidence to give you the best chance of securing the necessary finance to buy another business. This is what our advisory service provides:

OPTIMISING YOUR FINANCIAL MODEL

We will show you how to optimise your financial modelling and forecasts so funders have confidence in your business and the future performance of the combined organisation. We check ratios and returns making sure your projections will meet funder requirements. If not, we revisit the plan.

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APPROACHING THE FUNDING MARKET

We put you first by approaching the funding market on your behalf. We save you significant time, hassle and stress by knowing which funders to approach. We will present the best version of your business and combined organisation to maximise interest among the funding community.

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NEGOTIATING A BETTER FUNDING PACKAGE

We add exceptional value by negotiating better terms with your preferred funder. We do this by leveraging our independence and extensive market knowledge. We know where, and where not, to push funders.

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MANAGING THE FINAL OFFER & CLOSING PROCESS

We will deliver confidence and save you time by managing the final offer and facilitating the legal closing process on your behalf and to your required timeline. As soon as the legal contract for the financing has been signed, the funds will be transferred to your company bank account.

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ADDITIONAL BENEFITS OF USING SHAW & CO

MARKET INDEPENDENCE

We’re 100% independent of any funder. Unlike brokers, we are not tied to certain funders or products. Neither do we accept commissions which create conflicts of interest. We leverage our independence to get you the best deal. Let us deliver confidence.

RIGHT FIRST TIME

We save you considerable distraction advising you on exactly what funders need and how their requirements change. Don’t risk a funding rejection by guessing how to create a funding proposal. Let us show you the way.

SAVING TIME & STRESS

We work with the funding market on a daily basis. We save you considerable time knowing who to approach and what they need to see as well as knowing current market rates and practices. Let us add exceptional value.

RELATED AREAS OF EXPERTISE

FAQS

Do you accept non-UK clients?

No - We work exclusively with UK-based SMEs and small cap PLCs. However, our clients often have international activities and we regularly transact with overseas buyers and investors or arrange overseas acquisitions on behalf of our UK clients.

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What type of funding can you help me access?

We pride ourselves on understanding the requirements of, and having access to, funders in both the debt and private equity markets for funding in the range of £2m to £100m. Our team actively maps the ever-evolving funding market to give you confidence that all suitable options are being considered on your behalf. Our aim is to provide you an ‘all of market’ appraisal of your options.

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Should I use debt funding or equity funding?

That very much depends on your funding proposal. A huge benefit of working with Shaw & Co is that we do not have any bias towards a given lender, investor or type of funding, and we have the breath of expertise to advise across both debt and equity products. Both debt and equity have pros and cons, so our team can talk you through each so that you can make an informed decision and find the right solution.

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Wouldn’t funders rather that businesses approach them directly?

No. Funders appreciate a robust proposal and opportunity that has been thoroughly prepared and which they can engage with. They get frustrated by poorly prepared approaches and having to waste precious time coaching businesses on the information they need. Although funders will know that they are in a competitive process when receiving a proposal from Shaw & Co, they would much prefer this approach rather than dealing with ill prepared applications and patchy information. We give funders confidence that the information they are assessing is saving them both time and money - and by doing some of their work for them, we are able to negotiate lower arrangement fees.

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Do I have any say on which funders Shaw & Co approach to secure business funding?

Yes, of course. We work with you to agree which funders we will approach and discuss with you why we think that they will be good for your business. You ultimately decide the preferred funder to work with (or any to avoid!).

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When Shaw & Co is involved, will I lose control over the process?

Certainly not! When arranging your business funding, we are careful to agree how the process will be run, what the timescales are, which funders we will approach, and what outcome we are looking to achieve. From then on, we will we keep you informed every step of the way.

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How do you get paid?

We are remunerated only by our clients (not the funders). Our fees are predominantly 'Success Fees’, meaning that we get paid on completion of the deal. We take great care to make sure our fees are aligned with your goals, and we take pride in our fees always being a proportion of the value we add. We do also ask for a 'Commitment Fee' on all transactions which is calculated as a modest percentage of the expected ‘Success Fee’. Everything we may receive on a transaction is completely transparent to our clients.

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Does Shaw & Co accept arrangement fees from funders?

No, because we think that it is wrong. Some funders, particularly debt lenders, typically pay a referral fee to third parties for introducing a borrower and the client has no control over these arrangements. We believe this creates a conflict of interest and puts any client at a disadvantage, because any third party whose business is based on receiving a referral fee will be incentivised to ‘recommend’ the offers that earn them the biggest fees, rather than that which is best for the client. Furthermore, nothing is ever free. A referral fee paid by a lender to an introducer still comes out of the borrower’s pocket because the lender adds the referral fee onto the lending fee it charges for agreeing the facility. The lender and the introducer are in fact working against the client. If we are offered a referral fee, we either ask the lender to net it off the arrangement fees, or we pay that fee straight through to our client to make sure the client benefits, not us.

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Is Shaw & Co an expensive luxury when it comes to raising finance?

Absolutely not! Here is a reminder of what we do for you: We optimise your proposal, your financial model and articulate your USPs. Very few, if any, businesses are ready to, or know how to, approach a provider of finance. We approach the right funders in the right way on your behalf. By offering a professional, well thought through, easy to engage with proposal to funders, we create interest and run a competitive process which reduces funding costs. We can help to negotiate the entire package on your behalf, not just the price. There is so much more to an offer than the headlines. All this results in three benefits for you 1) a higher chance of securing the funding you need; 2) We can save you money by driving down funding costs, and 3) peace of mind that you have secured the right funding for your business.

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Are you sector specialists?

We have specific sector knowledge derived from many years of collective deal making experience. However, we pride ourselves on the diversity of sectors we work with which challenges us to think creatively. This creative and challenging approach brings huge value to our clients when helping them to build robust business cases.

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What sort of service experience can I expect if I instruct Shaw & Co?

We take all of our clients through a carefully crafted journey. Firstly, to ensure that we are a great match for each other and once engaged, to ensure we deliver exceptional client service that exceeds expectations.

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LEARN MORE ABOUT SHAW & CO

Why Shaw & Co

WE MAKE DEALS HAPPEN

Our highly talented people are creative, innovative and thrive when faced with a deal-making challenge. It's no surprise that we make deals happen and turn your ambition into a greater outcome.

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Fees & charges

COMPLETELY TRANSPARENT & ALIGNed With your GOALs

Our objective is to ensure that our fee more than pays for itself from the value we create for you and your business.

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