Sale of Manufacturer of Quality Crafted Furniture Frames
Potential buyers often seek acquisition opportunities which present synergies in terms of products, markets or business operations. The sale of Beechwood Frames Ltd demonstrated a clear case of how a company’s established products and services can generate high levels of interest from buyers actively seeking an ideal fit to expand upon their existing product offering.
As a UK based manufacturer of quality crafted furniture frames, Beechwood Frames benefitted from a 20-year trading history. Through its sole client, Beechwood Frames provided its products to an enviable customer base of reputable, high end furniture suppliers. The business enjoyed a thriving trade, with turnover and production figures unaffected by the Covid19 restrictions in 2020, and indeed seeing some uplift due in part to robust demand for quality domestic furniture to enhance residential spaces.
Its highly skilled team of frame makers and wood machinists specialised in creating bespoke frames to the highest artisanal standards, using traditional methods. This presented a significant advantage in a market where frame making skills are increasingly rare and at a premium. The company also came to market with a comprehensive range of tangible assets in the form of specialist woodworking tools and machinery and an extensive pattern archive derived from over 40 years.
Hornblower was introduced to Beechwood Frames by their accountant. The Directors expressed their intention to exit the business in order to retire and after an initial valuation we prepared to start the process.
Beechwood Frames first went on the market with Hornblower in June 2021 and by the time we had reached Heads of Terms in September 2021, we had received over 45 expressions of interest, and had had discussions with numerous qualified and funded buyers.
The key challenge with this project was the revenue concentration with the company’s top customer. However, the reliance was mutual and backed with a strong reputation in the industry. The company’s extensive pattern archive, which included vintage patterns used in previous relationships with prestigious past customers also provided a highly attractive proposition. These combined factors created clear opportunities for the buyer to expand the business.
The eventual buyer had been registered with us for some time and was well funded and with the means and credibility required to raise appropriate finance for the acquisition. As with many deals, there were many detailed aspects to be agreed and negotiated through due diligence and the drawing up of contracts, which is an area we pride ourselves on in managing transactions to a successful conclusion.
The buyer is an individual investor who is building a group of furniture and cabinetry manufacturing and saw our client’s business as an ideal strategic bolt-on. The successful sale of the business has now enabled the vendors to retire after 25+ years at the helm of the company within a handover period of just a few months.
The timing of the sale came as an additional bonus for the vendors, who had suggested that an ideal completion should take place before the cricket started in Barbados in March 2022. With that goal accomplished, the vendor is now able to claim the reward of the Barbados cricket tour, which he had promised himself as a retirement gift. We aim to please and sometimes do so in the most unexpected ways!
The deal was managed by our Business Sales and Acquisitions Consultant, Sian Murray. Sian manages business sales for Hornblower across the UK and internationally. Sian’s management of the deal received a glowing endorsement from the vendor, Andy J., who commented, “I just wanted to drop you a quick line thanking you personally for everything you have done to help facilitate the sale. Thank you so very much Sian all your hard work is appreciated.”
SOLD – January 2022