Accountancy Practice Aquisition - Owens Professional

About us

Owens Professional Partnership is a firm built on a foundation of wide experience and successful deals. It is led by Rachel Lindley LLM, who specialises in the merger and acquisition of accountancy practices. A qualified solicitor with particular experience in commercial and corporate law, she brings to bear on her brokerage work, expertise in business strategy.

Helen Owens BSc, ACIB, CIM, who founded the firm in 1997, acts in an advisory capacity. Helen has many years experience in accountancy practice broking and the corporate field generally.

We act as brokers exclusively to the accountancy market for the acquisition, sale and merger of partnerships and sole practitioner practices, and for other arrangements between firms.

We have a strong track record of successful sales and are known for the high degree of confidentiality and integrity with which we conduct our business.

Pricing

The general rule of thumb regarding pricing for many years has been 1x to 1.25x the annual fee income, although that multiple is increasing. In simple terms, the higher multiple is applicable for a high average fee and the lower multiple for a low average fee, although many other factors can also have a bearing.

The price multiple for sales in excess of c£350,000 tends to be lower. In such cases the structure of the deal is frequently more complex, involving partners retiring, remaining as consultants, becoming equity partners in the larger firm or joining as salaried partners or employees. Payments in these cases is likely to be a combination of capital payments for goodwill, reimbursement of capital accounts, consultancy payments or an equity share in the continuing practice.

Payment Pattern

It is generally the case that the smaller the practice the larger the payment on completion, and the larger the practice the smaller the sum on completion. So one may find that for a £50,000 practice then 75% is paid up front and the balance after twelve months whereas with a £350,000 practice there may be one third paid up front, another third after twelve months and the balance after twenty-four months.

Clawback

Most sale agreements include a 'clawback' clause, by which the purchaser pays for the clients which are retained. Adjustment to the price paid is made in the balancing payments after twelve and / or twenty-four months probably on a pro-rata basis for clients lost during the first year and at 50% in the second year if the clause extends to a second year.

Selling

The key to a successful sale is a good match of buyer and seller to maximise the level of client retention. We provide the following assistance with sale:

Discussion of succession options and timescale
Targeted marketing to produce a beneficial selection of potential purchasers
Guidance in the selection of a shortlist (to ensure manageable numbers and selection of most suitable firms or individuals)
Arrangement of initial meetings
Review of offers
Liaison with both parties during the period of negotiation
Pointers for the documentation

Buying / Merging

The key to a successful acquisition or merger is a good match of one party's client base and culture with those of the other party to maximise client retention, ease of assimilation and subsequent profitability.

Identification of requirement parameters
Discussion of pricing and other market conditions generally and locally
Outline of any specific current opportunities
Periodic regional mailings with a selection of local opportunities
Introduction of shortlisted firms to vendor / merger party
Profile of vendor / merger party to shortlisted firms
Liaison with both parties during the period of negotiation
Pointers for the documentation

There are many more buyers than sellers, so regrettably much buyer demand will remain unsatisfied.