Sale of Virtual Office, Virtual PA and Telephone Answering Company
“Successful sale of franchise operation to new owner exceeded expectations”
The Company
Hornblower was introduced to Kendlebell by the company’s longstanding accountants in Dublin, Leahy O’Riordan. Following this introduction, Hornblower took on Kendlebell as a client after preparing a free initial valuation and had several meetings to help the owner prepare for a sale.
Based in the Republic of Ireland, Kendlebell provides an outsourced telephone answering and virtual office service for SMEs operating under a franchise model. It has 4 offices - the Head Office and main branch is owned by the Franchise operator with the remaining 3 offices operated by franchisees.
The trading company consisting of the four combined franchised offices provides a wide range of outsourced solutions to c.750 business customers in the key categories of Inbound Call Answering, Outbound Services and Support Services, delivered from these contact centres based in Ireland.
Services offered on behalf of client businesses include Telephone Answering and Messaging, Virtual Reception services, Diary Management, Back Office Processing, 24/7 cover, Telemarketing and Database cleansing. The company is also able to provide temporary switchboard cover for lunchtime, holiday, sickness, breaks and out of hours cover.
The Situation
Having owned the business for 16 years, the owner, our client, took some time to decide on when to sell, taking into account several personal factors around what to do in retirement as well as considering carefully the value he would need to achieve from the sale to enable his retirement.
Given the timing of the sale, the value of the business proved a salient issue. The lockdowns in recent years highlighted the need for the business’s outsourced telephone answering and virtual office services, and therefore the business valuation was a moving target, increasing not insignificantly during the sale process.
Kendlebell first went on the market with Hornblower in February 2021, and we received a very good response from the market. Throughout 2021, the business experienced strong and sustainable growth in revenue and the bottom line resulting in the business being worth more at the end of 2021 than it was at the start. We therefore decided to relaunch the sale of the business in March 2022.
During the entire sale process, we had received 48 expressions of interest, and held discussions with numerous qualified and funded buyers.
The Outcome
Having relaunched the sale of the business in March 2022, we reached Heads of Terms in August 2022. The deal was completed in December 2022 and it took just marginally over the 3 months we normally expect for due diligence and the drawing up of contracts. As with many deals, there were many detailed aspects to be agreed and negotiated through the due diligence process and the drawing up of the contract. This is an area we pride ourselves on in managing transactions to a successful conclusion.
Opting to relaunch the sale of the business in early 2022 enabled us to achieve a deal value which was 30% higher than the offers received in the first half of 2021. Kendlebell was sold to Mayfair Grooming Ltd, which is wholly owned by a private individual experienced in the crucial fields of IT and franchising. The buyer’s objective is to work directly in the business and use these skills to achieve growth over the coming years.
The result of this acquisition is a secure financial future for the vendor of Kendlebell enabling him to pursue other business interests. He will also be working with the buyer for 12 months; not only will this facilitate a smooth hand-over, but also a gradual ease into other business areas. The acquisition represents a valuable cash generating addition for Mayfair Grooming Ltd.
The deal was managed by our Business Sales and Acquisitions Consultant, Julian Caplin. Julian manages business sales for Hornblower across Ireland and Northern Ireland. The vendors were also legally advised by the Dublin-based firm, Newman Doyle LLP.
SOLD – December 2022
