SUCCESSFUL EXIT PLANNING EVENT
TRI Cap’s first Exit Workshop took place in November: an event designed to tease out the development of a robust Exit framework for both TRI Cap members and their portfolio companies. The Workshop, which was opened by Chairman Rob Dick and chaired by TRI Cap member Jamie Andrew, included both presentations from a number of guest speakers and opportunities for open discussion.
Sandy Finlayson, senior partner at MBM Commercial LLP, reviewed key points from a number of exits on which his company had advised. Follow-up discussion was wide-ranging and included issues such as the position with businesses which are out-valued by their technology, family businesses, Proof of Concept, the importance of strong relationships and clear communication and planning.
Clovis Younger of ThinGenius Ltd provided background to the formation of ThinGenius and its Exit to Citrix. Points highlighted in the presentation included the part played by good relationships and professional approach, the need to research the acquirers, communication and orderly record keeping from the start as an aid to smooth due diligence at exit.
Tom Hart, lately of McQueen International Ltd provided background on the strategic development, growth and exit of McQueen International and reiterated many of the points made by Clovis Younger. Tom’s advice to businesses included the need to be flexible in business planning and in moving forward the Exit.
Further personal experience was recounted by Alan Walker in relation to ProStrakan and Warner Lambert. Alan summarised Agent, Stewardship and Resource theories and discussed how the psychology of those parties considering an Exit should be taken into account.
Alan believes that, typically, private companies do not plan for Exits unless they can foresee a benefit. Within the pharmaceutical industry an acquirer will be more interested in the technology than the business’ resources or management structure, making the value of the product the key emphasis. He recommended having a designated resource specifically managing the business’ Exit developments and keeping abreast of potential acquisitions – not necessarily the CEO/MD but somebody well suited to the role such as a non-executive director.
Following the presentations, there was a great deal of discussion about how TRI Cap should approach the planning for Exits, and also the alternatives to Exits. Clear communication, timing and planning, combined with an unsentimental approach, were key points.
Douglas Needham provided a very comprehensive summary of the morning’s discussion and findings, before Jamie Andrew closed the Workshop after thanking everybody present for their helpful contribution to the success of the Event.
Commenting on the event, Chairman Rob Dick said:
“Probably the central output from the Workshop was the realisation that TRI Cap requires to devote more time to planning and managing the Exit process: this event was extremely useful in highlighting the areas we need to address and in helping our individual members to understand the process. Now the real work starts in taking forward the issues we identified and, ultimately, in improving our planning and performance in this key area. To that end the Board has accepted a proposal from Jamie Andrew for the formation of a TRI Cap Audit Committee, to be chaired by Jamie, which will monitor the progress of investee companies towards their planned exits.”
END
November 2009
Issued on behalf of TRI Cap by Prior PR.
For further information contact Eileen Prior on 01721 729322 or 07802 180 412, or email eileen.prior@priorpr.co.uk