Begbies Traynor diversifies with transport consulting deal

Corporate recovery specialist firm Begbies Traynor has continued its attempts to diversify its offering with the purchase of a Manchester-based transport firm. Croft Transport Planning & Design is understood to have an annual turnover of almost £2 million, and will join the consultancy’s property services arm.

2018 was a difficult year for companies across the business spectrum, with huge numbers of collapses in the retail and casual dining sectors in particular marking out a poor year for the UK high-street. With the state of play showing no sign of improvement, and an impending culmination of two years of Brexit negotiations threatening to shunt the UK’s economy into a recession, this is surely set to be the case in 2019 as well.

A recent report from Begbies Traynor – the UK’s largest professional services consultancy specialising in the areas of corporate recovery and insolvency – found that the number of businesses in significant distress across the UK now stands at 481,000. This saw a particularly concerning leap of 15,000 during the final quarter of 2018, amid a winter of uncertainty that saw the likes of HMV collapse into administration, and left some 200 shopping centres on the brink of administration.

With this in mind, it is easy to see why some would expect the current economic environment to create big business for restructuring and corporate rescue consultants. This has not been the case, however, and contrary to the expectations of what would occur in the wake of a financial crisis, the insolvency market has been relatively static. At Begbies Traynor, this has impacted on the firm’s profit line, and as a result it is chasing a rapid agenda of diversification. To that end, the firm has continued the expansion of its property services arm, acquiring Manchester-based consultancy Croft Transport Planning & Design.

Croft Transport was established in 2010 to provide highways, transport and traffic advice and expertise on commercial, residential and mixed-use schemes to developers, house builders and landowners. Its last reported annual turnover stood at £1.8 million, with pre-tax profits of £0.7 million in the year to 30 September 2018, while at that time its gross assets amounted to £2.2 million. The firm’s team of 10 will join the Eddisons professional services business, which Begbies Traynor acquired in 2014.

This is the fourth acquisition Begbies Traynor has undertaken since 2014, as the firm looks to diversify its offering. Other firms purchased in that time included property valuation firm Taylors, property auctioneers Pugh & Co and industrial auctioneers and valuers CJM.

The consultancy’s property wing will continue to provide chartered surveyors with expertise in valuation and asset disposal to both solvent & insolvent cases. Following the payment of an initial consideration of £1.5 million, Begbies Traynor will be liable to pay a further £2.5 million if “stretching financial targets” for the business are met during the following five-year period.

Commenting on the acquisition, Begbies Traynor’s Executive Chair Ric Traynor said the move furthered the group’s aim of developing a property services division “by increasing both the scope of its service offering and geographical coverage”.

Traynor added, “Croft has excellent relationships with a broad range of clients, which have been developed by providing a consistently high quality, specialist and professional service over many years.”