South: Is the clock ticking for business sales? asks BCMS report

BCMS, the specialist lead adviser to shareholders of private companies, has assessed the potential impact of the impending retirement of the baby-boom generation on M&A activity, and foresees a far greater number of businesses coming to the market over the next decade.

This is based on the findings of its latest white paper, produced in association with law firm Penningtons Manches, entitled 'Is the clock ticking for business sales?’. According to the paper, almost two thirds (63%) of small business owners in the UK are over 50. Of those over 60, two thirds (64%) have no clear succession plan and are postponing seeking a sale. 

The paper thus foresees a global increase in the number of businesses offered for sale in coming years. At the same time, it notes that many of the natural successors and potential buyers of private companies are members of the generation born between 1965 and 1985, few of whom have the equity or necessary financial resources to secure commercial loans.

The situation is thus likely to play into the hands of multiple-acquirer companies with an eye on taking over growing, specialist businesses.

Simon Bickerdike, Penningtons Manches corporate partner who specialises in advising owners on how to sell their companies, commented on the findings: “There is never a perfect time to sell your business as many external market factors are beyond control, but the rule of supply and demand is immutable and the best prepared will have the pick of the opportunities.”

Steve Anstey of BCMS UK commented: “Those motivated by retirement are probably less concerned about the right market conditions to sell and more about exiting at a time which suits their lifestyle planning.”

To share the insights of the white paper, BCMS and Penningtons Manches are hosting an expert panel event on Thursday July 7 at the Penningtons Manches London office. This is designed to give business owners the information they need to plan their next steps.

Information about the event can be obtained by emailing seminars@bcms.co.uk.