The journey to selling or growing your business starts here
M&A, Equity & Beyond Specialists in Freight & Logistics
Recognise your company’s worth. Realise your future.
Make a successful strategic exit 4CAP Equity is a specialist M&A consultancy firm harnessing many years of experience in the Freight & Logistics sector. Our founding directors have overseen and completed dozens of transactions in this active industry, working with companies across the globe. This distinct expertise ensures we provide the clear M&A guidance required to effectively piece together, manage and support transactions from inception to completion.
Freight & Logistics are thriving The Freight & Logistics sector presents a multitude of opportunities for successful M&A activity, driving growth within the industry. The movement of goods has long been a necessary requirement on both a domestic and international level, and its gradual expansion in recent decades has been complemented by a rise in M&A activity. This growth and impact of market activity started to accelerate in the early 2000s with large, global logistics companies such as DHL leading the consolidation charge, acquiring companies to bolster their market share. In nearly 20 years since, the rise in M&A activity has continued, with all manner of companies involved – from small, privately owned forwarders right up to large, publicly listed logistics conglomerates. Now, M&A within the Freight & Logistics sector is at an all-time high, largely due to the significant fragmentation in the industry. This has resulted in a continual increase in mid to large players looking to consolidate the market, presenting substantial opportunity for both buyers and sellers to complete successful transactions.
Market activity As of Q4, 2018, the global freight forwarding
284 DEALS
€130 billion
in the global transportation and logistics sector
were recorded last year
Freight
& Logistics market grew
8% LAST YEAR
Last year we also witnessed an
18% 5% increase increase in deal value
Economic forecasts expect it to reach
€140 billion by 2020 with wider transportation and logistics market predicted to reach over €13 trillion by 2023
Asia & Oceania
UK & Eurozone
51% 42%
23% 33%
comes second, representing
most active region, representing
OF DEAL VOLUME
OF DEAL VOLUME
OF DEAL VALUE
Around 40% of market
OF DEAL VALUE
Air and road freight
share held by small, owner-operated firms,
in deal volume
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market is worth approximately
Strategic investors
representing value over
account for more
€52 billion
recorded deals
than half of all
sub-sectors experienced over growth in deal
30%
volume last year compared to 2016
Make the most of this exceptional activity This record-breaking M&A activity in the Freight & Logistics sector makes now the time to consider exiting your business. The industry is ripe for consolidation and packed with opportunities to achieve a successful sale for the optimal value. Speak to our specialists to learn more about this thriving market and how you can capitalise while activity is at an all-time high.
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M&A, Equity & Beyond What is your business worth?
Contents
Do you know the value of your company in the current market? Our unmatched expertise helps determine what your business is worth.
Selling your business
08
Private equity
10
Our experts
12
Buying a business
14
Our goal, your success
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Contact us
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Utilising key financial data you provide about your business, combined with our industry-wide knowledge of current market conditions and previous acquisitions, our specialists provide an estimate of your company’s worth. The journey to a successful exit starts with knowing how much your company is really worth. For the ideal start to this process, engage our team for a comprehensive analysis.
Our Process
Selling your business
To achieve an offer that reflects the value of your business, we employ a 5-step process, setting out the structure of how we manage and deliver a successful exit strategy:
With notable consolidation in the Freight & Logistics sector, we are seeing healthy levels of M&A activity. With our experience and expertise behind you, now is the time to realise your company’s worth, review your exit strategy and start the journey to a successful, beneficial sale.
Review The start of your journey is a thorough review of your business, which will determine an estimated value range, gauge potential market interest, and develop a detailed proposal for prospective buyers.
Reason to exit Retirement – After the investment you have made into your company, you deserve to enjoy the life that comes after it. If the time is right to step back from your business, a sale provides the financial security required to facilitate your retirement. We can help you achieve this goal, sourcing a buyer that will maintain your company’s legacy and provide the same level of support for your employees and clients.
Marketing We showcase your company’s best features through standout marketing material, using confidential canvassing methods to share this with interested buyers. Buyers Our wide-ranging, global industry network of 50,000+ companies means we can give your business the most exposure to prospective buyers. From this we develop a shortlist of buyers who can fulfil your goals and ambitions for the sale of your business.
Change in personal circumstances – Perhaps a recent change has caused you to re-evaluate your situation. Whether you are seeking new challenges, relocating, or facing unforeseen circumstances, we help smooth your transition and free up resources to help you make this change. Accumulate capital to invest – Your business is likely your largest asset, forming a large majority of your personal wealth. A partial or full exit can help to diversify your portfolio and improve the health of your personal finances. Achieve a return on investment – You likely know the value of getting in on the ground floor and realising your investment at a favourable juncture. Our expertise in Freight & Logistics helps you secure the optimal return for your company.
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Offers We lead negotiations between you and your chosen buyers, utilising our industry experience and past achievements to deliver an offer which meets your personal and financial goals.
Completion We prepare you for the intensive due diligence and legal work to close your deal, reducing the stress of this process and ensuring the priorities of all involved are appropriate and proportionate.
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Private equity
Reasons to consider private equity Increase company value
If your business is at a stage where it requires additional capital or the implementation of corporate governance to take it to the next stage, then partnering with a Private Equity firm could be an option worth exploring. With over USD 1 trillion of committed capital, there is no shortage of private equity firms across the globe with money to spend. Last year PE firms were responsible for over 50% of mid-market acquisitions. Focus on the Freight & Logistics industry is being driven by several factors; an ever-increasing demand on intelligent supply chains with Freight & Logistics companies being pivotal. Nothing can get produced, manufactured, or sold without a supply chain. In addition, despite increased M&A activity, no one single company controls the market – it remains highly fragmented. This creates a wealth of opportunities to consolidate multiple companies whilst leveraging economies of scale. Exit opportunities are plentiful for any seller in today’s market and this remains true with PE firms. Ahead of any investment, a private equity firm will consider how to realise their investment. At the end of the investment there is the option of listing the business in order to divest, but this typically requires large amounts of capital and a great deal of management time. A preferred option in recent years has been a trade sale or a sale to other financial acquirers. For owners considering a private equity firm, it is important to remember that they will have a vested interest to keep business disruptions to a minimum post-investment. As your partner, they are incentivised to make your company more efficient and robust in the ever-changing landscape of the industry.
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Private equity firms are specialists at building the value of businesses – by incorporating their investment and taking on board their advice, when the time comes to exit completely, your company could be far more lucrative to both you and your investors.
Improve company structure The expertise of private equity firms can improve areas of your business beyond its financial performance, such as management guidance, improved marketing and sales techniques, and wider networks for support.
Continue your journey While private equity firms will invest in your company, they do not always take a direct role. As they typically strike unique Shareholders Agreements, you could be able to manage your business as you’ve become accustomed to, just with greater capital and expertise available should you need it.
Partnering with a private equity firm is a significant decision, and should be approached with the right expertise behind you. Our specialists help source investors that support the journey of building your business and manage negotiations to ensure the offer is appropriate based on your company’s worth.
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Our experts
James Hughes
Jack Lonnen
Founder & Director of Buy-Side Advisory
Founder & Director of Sell-Side Advisory
James has an extensive background in the Freight industry with over 13 years’ experience across the UK, Europe and the USA. With an unrivalled network of contacts, clients actively engage James to identify, approach and close multi-million-pound transactions.
TRANSACTIONS Sale of SAI Logistics Limited to Santova Limited Sale of Tradeaway Shipping to Santova Limited Sale of Eurotran Despatch to EFS Group
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Jack has extensive experience as an M&A consultant in the Freight & Logistics sector, with an impressive background in B2B sales stretching back to 2006. His primary focus is enabling his clients to realise the maximum value for their business, working predominantly on sell-side engagements.
TRANSACTIONS Sale of Selvic Shipping Services Limited to Major Cargo Sale of RSH Freight Masters to LEMAN Sale of Dalpa International to LEMAN
Sale of Brad Trans International to EFS Group
Sale of Fraser Freight to Jersey Post
Sale of Hay World Cargo to Air & Cargo Services
Sale of Regional Express to Xpediator PLC
Sale of EL Sibbles to Mapcargo
Sale of Davies International to Claridon Group
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Our Process
Buying a business If you are interested in buying a business in the Freight & Logistics sector, we can introduce you to ideal acquisition targets that fulfil your unique criteria. Our specialists understand that the process of acquiring a business can be a strenuous one. We commit to reducing your workload during this process by supporting your management teams with the details, identifying only the most fitting targets in line with your aims, and moving forward with absolute efficiency and complete confidentiality. With access to a broad network of acquisition opportunities throughout the globe, we can support your ambitions and navigate the purchasing process.
Our approach to buying a business follows this 6-step process:
Market research Our research team identifies a long list of potential targets matching your criteria, gathering their vital information and making this available to review at your convenience.
Approaching targets A confidential approach is made to key shareholders of each target, gauging their appetite to sell to ensure no time is wasted pursuing unwilling sellers. Shortlisting We work with you to determine a final shortlist of potential targets, and discreetly contact these targets to collect in-depth information of their structure and financial performance.
Negotiation & completion Should you wish to make an offer, we prepare a valuation and structure for the purchase, actively negotiate with the target and guide discussions toward an amicable Purchase Agreement. 14
Initial meeting We meet with you to discuss your goals for the acquisition, your budget and the resources you require to develop an initial specification for potential targets.
Introduction We arrange, manage and lead initial meetings between you and selected targets to discuss your respective business journeys and lay foundations for a potential transaction.
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Our approach
Our service
Our standards
Professional Unwavering commitment to complete confidentiality, diligent research and total discretion.
Comprehensive Our support extends across your entire exit journey, backed by a wide network of industry and financial contacts.
Confidential We place confidentiality at the forefront of all transactions, serving your interests with absolute discretion.
Knowledgeable Immense industry-specific expertise that helps clients overcome obstacles to achieve an optimal deal.
Focused Our total focus on the Freight & Logistics sector gives us a unique insight into market trends.
Integrity We ensure we meet all expectations for our clients in their transaction, not just on price.
Partnership We work closely as your partners to enhance the value of your company and navigate the sales process.
Proven Our team’s 40+ years of experience gives us an unrivalled understanding to support both buyers and sellers.
Dynamic Our energetic, adaptive approach helps clients choose the right time to sell and react to market trends.
Our goal, your success We are committed to managing and completing transactions that benefit our clients and help achieve their goals. For us, success is a transaction that is brokered professionally, completed efficiently and achieves the goals of our client. This comprehensive approach is dedicated to maximising your exit.
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Contact us It’s never too early to think about the future for you and your company. With very healthy M&A activity in the Freight & Logistics sector from active buyers and private equity investment, now is the time to discover how this could impact your journey. Whether it’s determining the value of your business, learning about market trends or taking the first step on your path to exit, we are here to help you make your next move with confidence and clarity.
Talk to us today about exploring opportunities for your company: Exit planning Growth strategies Private equity Business valuations
Company contacts: 4CAP www.4cap-equity.com
Jack Lonnen, Founder & Director of Sell-Side Advisory
James Hughes, Founder & Director of Buy-Side Advisory
t: +44 (0) 117 911 8183 e: info@4CAP-equity.com
t: +44 (0) 7711 406014 e: jack@4CAP-equity.com
t: +44 (0) 7592 652513 e: james@4CAP-equity.com
EQUITY
Realise your future with a team you can trust. Start your journey to exit with complete peace of mind.
Argentum House 510 Bristol Business Park Coldharbour Lane Bristol BS16 1EJ t. +44 (0) 117 911 8183 e. info@4CAP-equity.com www.4cap-equity.com