|Deal completed in:||11 Months|
The Commercial Cleaning Services Company provides daily cleaning services to office premises in central London. It has an excellent client base ranging from government bodies to commercial banks and commercial property owners and landlords, all of whom operate from high quality and prestigious office environments in the City and the West End.
With over 30 such clients on rolling service contracts plus 2 major clients on 5 year fixed term service contracts, it offered a very desirable strategic acquisition for the right trade/strategic buyer.
The managing director came to us as he wanted to retire. Whilst he had a competent general manager to run the business day-to-day, he nonetheless wished to release himself from the responsibilities of ownership, such as business admin and HR as well as ensuring ongoing business development and sales. The general manager owned 20% of the company and was willing to stay on running the business. The managing director was keen to secure the future for his general manager and other long term staff.
What Hornblower Did
We have a strong database of trade buyers and investors who we knew would be very interested in acquiring a business such as this. We also researched and approached commercial cleaning and facilities management companies whom we had qualified as being in a position to acquire a business of this size.
We took the business to market in July 2014 and had agreed heads of terms by November 2014 – within 4 months. For a variety of reasons the due diligence and legal transaction took somewhat longer than usual; however the deal completed within 12 months of starting the process on 1st June 2015.
During the sale process, we handled over 90 enquiries for the business and received 21 offers.
The final buyer is a large facilities management company in the South East of England. The business had a real strength in hard facilities management delivery (maintenance of buildings and systems etc.) but no capability in the soft side (cleaning). This precluded it from tendering for quite a number of opportunities so they had decided to acquire the capability and proven track record along with the excellent and prestigious reference sites.
The new combined entity is already tendering for a major contract worth £180k per annum.
The general manager received a windfall payment for his 20% and has remained with the company under its new ownership. As a result the manager director will be able to retire fully after a relatively short handover period.
We wish them every success in the future.