The print industry is on the brink of a spike in acquisitions according to Paul Holohan, chief executive of Richmond Capital Partners.
“After months of lockdown and the severe consequences to many businesses, it may come as a surprise that there are more owners looking to buy businesses at present than there are sellers, “ he said.
“Of course, the gestation period from deciding to buy or sell to actual completion is a rather lengthy one, and much of the current level of activity in this arena really began prior to Covid19 restrictions. But a high level of offers are still resulting through this pipeline and it seems print and packaging owners are thinking very seriously of their strategic approach for a new commercial reality post Covid.”
Holohan believes the Chancellor’s anticipated tax reforms to deal with the economic fallout from Covid could well create an incentive for mergers and acquisitions, and added: “Whilst actual deal completions have been relatively limited over these troubled times, interest and enquiries are now at a high level.”
He pointed out that there is a lot of finance available from potential investors with unused capital resources to invest in strong business plans driven by poor returns given interest rates currently on offer.
“People who have been hanging around since before Theresa May was Prime Minister are now thinking ‘let’s get a deal done in the new year because there is loads of capital around’. Once they can demonstrate some sensible post-Covid trading, then they will want to implement their plans. I think next year will be a bumper M&A year for that reason. The potential tax increases coupled with the uncertainty of a post Covid marketplace are focusing attention on future opportunities to maximise business. For many, now is undoubtedly a good time for mergers and acquisitions to be the key to new business growth and development.”