Uncertainty around Brexit trade negotiations appears to have shown little impact on the UK recruitment deals market in 2018 to date.
M&A activity within the UK recruitment sector continues to remain healthy, with a mix of private equity and trade transactions. Private equity continues to have cash to deploy. In addition, the availability of the debt market is generally improving the market outlook for sellers, especially for high quality staffing businesses operating in sectors with skills shortages.
What’s been happening in the last six months?
The first half of 2018 has seen some significant transactions, most notably Alexander Mann Solutions’ £820m sale to Canada-based private equity firm OMERS. Other notable deals also include an international flavour with Beijing Career International’s partial investment into Investigo; Kinetic plc’s acquisition through an employee ownership trust; and a further bolt on in the medical sector by Independent Clinical Services, this time of ProClinical.
Beechbrook Capital’s growth capital unitranche funding of Leathwaite International Holdings, a leading global human capital group with a strong niche in financial services, represented another institutionally-backed transaction within the sector. This follows on from the likes of Graphite Capital Management’s exit of TMP Holdings, Chamonix Private Equity’s exit of Shorterm Group in 2016, and Key Capital Partners’ exit of NursePlus in 2015.
The transaction is RSM’s tenth deal in the recruitment sector over the past 18 months. Other deals represent a range of corporate finance services, including TimePlan Education and Edison Technical Recruitment on the M&A side, ICG Medical and Shorterm Group on the sell-side due diligence, as well as nGage’s acquisition of GCS, the buy-out of Berkeley Group and Graphite Capital’s acquisition of Empowering Learning on the due diligence buy-side.
What is the value of preparing your recruitment business for exit?
Preparing your business for a sale well ahead of time is critical for a successful exit. It can identify potential pitfalls that may be detrimental to the overall value achieved or cause complications during the M&A process.
Named number one most active M&A advisor in Experian’s Q1 league tables, RSM helps enhance the deal value by understanding how best to present the business for a transaction. Drawing on our specialist transaction experience in the recruitment sector mid-market, we can identify key opportunities for owners, management teams and prospective buyers.
We can highlight key considerations through a Readiness Review at various stages of the process, whether preparing vendor due diligence pre-sale or if a transaction is not being considered for 12 to 18 months.
Exit readiness helps your business explore the options and make it ‘transaction-proof’ to achieve a deal that meets all stakeholders’ aspirations and maximise cash.