Begbies Traynor Group acquires Banks Long & Co to strengthen its property services division

LONDON, UK: Begbies Traynor Group plc has completed the acquisition of BLC No1 Limited, which trades as Banks Long & Co, according to an announcement made by the business recovery, financial advisory and property services consultancy on Wednesday.

Banks Long & Co is a firm of chartered surveyors with 38 employees in Lincoln, operating throughout Lincolnshire and Humberside.

The company offers commercial property agency, property management, building consultancy, and valuation services to a broad range of regional clients, including public and private sector organizations.

The company’s service offering aligns with the current service offering of Begbies Traynor Group and strengthens its regional presence across Eastern England and South Yorkshire.

In the financial year ending August 31, 2022, Banks Long & Co generated an unaudited revenue of £2.6 million and normalised pre-tax profits of £0.4 million (when reported on the same basis as the group). Trading is projected to maintain at least this level in the current financial year to date. The company had net assets of £2.1 million (including £1.4 million cash) as of August 31, 2022.

Begbies Traynor Group’s overall strategy is to increase the scale and quality of its businesses both organically and through value-accretive acquisitions, delivering strong, sustainable financial performance. Its strategy in property services is to enhance and broaden its service offerings and geographical coverage.

Since the division’s creation through the acquisition of Eddisons in December 2014, Begbies Traynor Group has built a strong track record of acquisitions that have met these criteria. This strategy has increased the division’s scale from an annual revenue of approximately £13 million at inception to a current run rate in excess of £30 million, demonstrating strong growth and enhancing the group’s earnings.

The acquisition is in line with the group’s strategy, as the Banks Long & Co team will strengthen its existing offering and footprint in Eastern England and South Yorkshire, following the recent acquisitions of Mark Jenkinson & Co (Sheffield – March 2023) and Budworth Hardcastle (Eastern England – June 2022). The acquisition is expected to be immediately earnings-enhancing.

The acquisition consideration is structured based on current levels of financial performance and on a cash-free, debt-free basis.

The initial consideration is £1.5 million, payable £1.125 million in cash and through the issue of 292,170 new ordinary shares.

There is also an earn-out of up to £1.5 million, subject to the profitability of the business, with the full payment subject to aggregate pre-tax profits of £5.0 million over the five-year period post-completion. This gives a maximum consideration of £3.0 million (on a cash-free, debt-free basis).

The cash consideration will be met from the group’s existing financial resources, with significant headroom available for further acquisitions and investment.

Anthony Spencer, Director at Eddisons, said, “I am very pleased to welcome the Banks Long & Co team to Eddisons, which extends our footprint into Lincolnshire and enhances our existing presence in Eastern England and South Yorkshire”.

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