April 23, 2018
This month we interview Paul Casey, Senior Manager at Bluebox who joined us back in January. He shares his motivations behind starting a career in corporate finance and shares his views on the M&A forecast for 2018.
What was your background prior to joining Bluebox?
I trained as a chartered accountant at Smith and Williamson, working predominantly on the audits of small and medium companies. I then joined Smith and Williamson’s transaction advisory services team, where I spent 4 years specialising in financial due diligence and business modelling, before moving into corporate finance team, where I focussed on sell side M&A advisory work.
What were your motivations behind choosing a career in Corporate Finance?
I have always focussed on owner managed/entrepreneurial clients, working closely with management teams and owners. Corporate finance allows me to be involved from start to finish of an exercise, from assisting with an exit strategy all the way through to a transaction completing.
What do you enjoy most about your role?
The job requires building close relationships with clients, investors and other advisers, which was a significant factor in my choice of career!
What does a typical day look like for you and what are you currently working on?
Each day varies which is the beauty of what I do. I will speak to the majority of my clients on a daily basis, as well as speaking to potential investors and acquirers in order to better understand any acquisition dynamics impacting the industries in which my clients operate.
We have a talented team here at Bluebox, so are constantly challenging each other’s ideas to ensure the advice we are giving is of the highest quality.
What do you find are the main obstacles to watch out for that can threaten a deal, prior to closing?
A significant, and relatively surprising, proportion of businesses taken to market in the UK fail to sell. Common reasons include unrealistic valuation expectations, issues during due diligence and, critically, drops in trading levels.
The activity of private equity firms, the relatively low cost of borrowing and the acquisition appetite of large corporates means that it continues to be a great time to be a seller; but it is critical to prepare in advance to ensure that the inevitable obstacles later on in the process don’t trip up a deal at the final hurdle.
Here at Bluebox there is a focus on the preparation for a sale, both in terms of shareholder objective and business readiness.
What about a look at M&A activity more generally? Which sectors are receiving the most attention?
There continues to be a trend towards the acquisition of tech companies, as commented on in Bluebox’s April Technology Report. The historic trend of acquisitions of tech firms by tech firms has broadened, to non tech businesses targeting technology acquisitions. The reasons are generally very simple; businesses can develop their technology capabilities faster by acquisition than by development in house, and can also ahead of competitors by being the first (and sometimes only) to have access to the latest technologies.
Within technology, we’re also seeing a lot of activity related to the “Internet of Things,” with businesses speculating on the future of things like a connected home. It will be interesting to see where this goes.
Away from technology, healthcare continues to be a sector in which M&A continues to be strong. Connected with this, health and wellness is a market place that has developed significantly over the past few years and I expect will continue to do so. The number and variety of brands and products created to provide solutions to a number of fitness, well-being and mental health issues has created a highly a highly fragmented market. At some point I expect there to be a large amount of consolidation; but for now it will be interesting to watch the market grow.
What is your forecast for 2018 in terms of M&A activity?
Corporate and private equity executives continue to be bullish about the level of acquisition and investment activity in 2018 and I don’t see any reason why activity would slow down.
What’s the best advice you’ve ever received?
“Most success comes from repetition, not new things”.
It may not be the most exciting of slogans to put on a t-shirt, but simple advice is often the most effective.
Don’t be perturbed by finding things tough or getting things wrong, and try to avoid quick fixes. The first time you do things you are probably going to be rubbish, so accept it and learn from it.
With the amount of practice you need to do in a career, it really helps if you enjoy what you do!
And more about you Paul…
Summer or winter? Summer
Morning or evening? Morning
Favourite sport? All of them… (currently golf)
Ketchup or brown sauce? Neither. Extra bacon.
Favourite film? Gladiator
What is your favourite cuisine? Spanish tapas. Preferably seafood.