FRP achieve successful sale for HVAC specialists

Background

T Jolly Services Limited and Atlas Sterile Services Limited, both based in Preston, provide heating, ventilation and air conditioning (HVAC) maintenance and repair services, and compliance testing for cleanrooms. The businesses have a recognised presence in the hotel, care home and retail markets, as well as serving a number of UK universities.

Having grown the businesses to a revenue of around £7 million, with £1 million of earnings before interest, taxes, depreciation, and amortisation (EBITDA), the vendors were looking to realise value through a 100% shareholding sale. The market had been going through a period of consolidation, and JLA Group, a highly acquisitive trade player, made an off-market approach to the vendors. T Jolly Services and Atlas Sterile Services appointed FRP to assist and advise on their sale to JLA Group.

Action

As sell-side mergers and acquisitions advisers, FRP’s Corporate Finance team initially managed the financial due diligence process undertaken; key areas of negotiation included the assessment of normalised EBITDA and net working capital. Our team were then involved with the negotiation and review of the sale and purchase agreements, including ensuring the various components were in the vendors’ best interest.

The deal was completed relatively quickly, given the pressures and uncertainty regarding the proposed changes to entrepreneurs’ relief. The Corporate Finance team were able to work effectively and collaboratively with both the vendors and buyers to ensure a smooth and transparent process.

Outcome

FRP’s advice was instrumental in negotiating the best outcome for the client in relation to the overall purchase consideration, normalised EBITDA, and net working capital. The sale process was run to a tight timescale, and we were able to meet vendor expectations and ensure the timely completion of the deal. The two businesses are expected to fit in well at JLA Group and complement the existing services provided by them.