Baker Tilly boosts Corporate Finance team in Aberdeen

16 July 2015 Consultancy.uk

Baker Tilly in Scotland has appointed Tom Faichnie as Corporate Finance Partner and Ian McDonald as Associate Director to its Corporate Finance team. The two are set to strengthen the last year established Aberdeen team and realise client demand in the North East of Scotland.

Tom Faichnie joins Baker Tilly from Campbell Dallas, a firm he joined in 2010 as a Partner, providing corporate finance advice and setting up the Aberdeen office. Between 2006 and 2010, he worked for Barclays Bank, first as Director of Leveraged Finance in Oil & Gas and later as Director of Business Development in Oil & Gas. Prior to this, he fulfilled the role of Corporate Finance Director at Deloitte, between 1997 and 2006, and as Asset Manager at KPMG, from 1992 to 1997.

Faichnie holds a Bachelor degree in Accountancy from the University of Glasgow.

Tom Faichnie, Ian McDonald

Ian McDonald started his career in 2007 as an Analyst at the Bank of Scotland, working in the European Joint Ventures division. In 2008 he joined Barclays Corporate as a Relationship Support Manager, before joining Clydesdale Bank in 2010 as an Invoice Finance Partner. Between 2011 and 2013, the acted as Associate Director for Adam & Company and from 2013 to 2015 as Assistant Director in Corporate Finance for Campbell Dallas, before joining Baker Tilly.

The two appointments are set to strengthen Baker Tilly’s Corporate Finance team in Scotland, which was established last year. The two new hires will work under Ewan Grant, Head of Corporate Finance in Scotland and Associate Director Connor Agnew. “I’m absolutely delighted to welcome Tom and Ian to the team. They are well known locally, and they bring with them unrivalled transaction experience, particularly in the oil and gas sector,” comments Grant.

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8 tips for successfully buying or selling a distressed business

18 April 2019 Consultancy.uk

Embarking on the sale of a business is one of the most challenging experiences a management team can undertake. Even serial dealmakers acknowledge that the transaction process can be gruelling, exposing management to a level of scrutiny and challenge through due diligence that can be distinctly uncomfortable.

So, to embark on a sale process when a business is in distress is twice as challenging. While management is urgently trying to keep the business afloat, they are simultaneously required to prepare it for scrutiny by potential acquirers. Tim Wainwright, an experienced Transactions Partner with Eight Advisory, says that this dual requirement means sellers of distressed businesses must focus on presenting their business in a way that supports buyers in identifying value, whilst simultaneously being open about the causes of distress. 

According to Wainwright, sellers of distressed businesses should focus on eight key aspects to ensure they are as well prepared as possible:

  • Cash: In a distressed situation cash truly is king. Accurate forecasting and day-by-day cash balances are often required to ensure any buyer is confident that scarce cash reserves are under proper control. 
  • Equity story and turnaround plan: Any buyer is going to want to understand the proposed turnaround strategy: how is the business going to enact its recovery and what value can be created that means the distressed business is worth saving? Clear presentation of this strategy is essential.
  • The business model: Clear demonstration of how the business model generates cash is required, with analysis that shows how financial performance will respond to key changes – whether these are positive improvements (e.g., increases in revenue) or emerging risks that further damage the business.  Demonstrating the business is resilient enough to cope with these changes can go a long way to assuring investors there is a viable future.
  • Management team: As outlined above, this is a challenging process. The management team are in it together and need to be consistent in presenting the turnaround. Above all, the team needs to be open about the underlying causes that resulted in the distressed situation arising.  A defensive management team who fail to acknowledge root causes of distress are unlikely to resolve the situation.

8 tips for successfully buying or selling a distressed business

  • Financing: More than in any traditional transaction, distressed businesses need to understand the impact on working capital. The distressed situation frequently results in costs rising as credit insurance becomes more difficult to obtain or as customers and suppliers reduce credit. Understanding how these unwind will be important to the potential investors.
  • Employees: Any restructuring programme can be difficult for employees. Maintaining open communications and respecting the need for consultation is the basic requirement. In successful turnarounds, employees are often deeply engaged in designing and developing solutions. Demonstrating a supportive, flexible employee base can often support the sale process.
  • Structuring: Understanding how to structure the business for the proposed acquisition can add significant value. Where possible, asset sales may be preferred, enabling buyers to move forward with limited liabilities. However, impacts on customers, employees and other stakeholders need to be considered.
  • Off balance sheet assets: In the course of selling a distressed business, additional attention is often given to communicating the value of items that may not be fully valued in the financial statements. Brands, intellectual property and historic tax losses are all examples of items that may be of significant value to a purchaser. Highlighting these aspects can make an acquisition more appealing.

“These eight focus areas can help to sell a distressed business and are important in reaching a successful outcome, but it should be noted that it will remain a challenging process,” Wainwright explains. 

With recent studies indicating that the valuation of distressed business is trending north. With increased appetite from buyers who are accustomed to taking on these situations, it is likely that more distressed deals will be seen in the coming months. “Preparing management teams as best as possible for delivering these will be key to ensuring these businesses can pass on to new owners who can hopefully drive the restructuring required to see these succeed,” Wainwright added.