Founded in 2007 and based in Ossett in West Yorkshire, OJ is a health and safety consultancy company that offers training, consultancy and assessment services to clients in the UK. The firm has developed a retained service package consisting of one-to-three year agreements to deliver 24-hour support to clients, with additional offerings including fire safety, asbestos surveys, health assessments and accident investigations.
The deal sees Newable Compliance acquire a majority stake in OJ. Newable Compliance provides long-term strategic investment to businesses with a focus on supporting SMEs in meeting their compliance obligations, targeting investment in three to four such businesses on an annual basis. With this acquisition, Newable Compliance expands its investment portfolio and provides OJ with the necessary resources to extend its services to a wider audience of SMEs.
Mackrell Solicitors advised the shareholders of OJ with a team led by consultant solicitor Guvvy Sandhu and corporate associate James McKimm.
An Interview with Guvvy Sandhu at Mackrell Solicitors:
Please share a little more about the above investment and the role that your team played in facilitating it.
We acted for the shareholders of OJ. Our key role was to empower the shareholders by explaining in plain English what was meant by a majority stake and what that would mean for the shareholders both on completion and after the sale as to ensure any retained interest in the business is looked after.
Selling a business is more than just a financial and documented process: it is a transition of hard work and legacy and it is important to break down complex terms and unwind the legal jargon that sometimes accompanies a transaction.
On behalf of the shareholders, we reviewed two steps: completion of the investment and the future as regards the retained interest. We explained and guided the shareholders as to what Newable would expect from the shareholders as new ’business partners‘ (to coin a phrase) and how that would translate into the paperwork.
What aspects of OJ’s business made the firm an attractive investment opportunity for Newable Compliance?
Of particular interest to Newable was that the retained service package created by the shareholders meant that the majority of OJ’s revenue was on a contracted basis, and for any potential buyer that offers a very appealing proposition when thinking about how soon the benefit of the investment could be recouped. This was equally appealing to the shareholders, as there is a marked divergence between investor demand and the cost of funding from traditional funders.
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We also explained and guided the shareholders as to what they should expect from Newable in relation to the investment and the retained interest, given that this transaction was a two-way process.
Of particular interest to the shareholders was the natural ability to remain with the business in relation to which they played a key part, as well as the flexibility that the investment offered, because it was paramount to think about what the future held personally for the shareholders. Behind every business there is a person with a story, and that story is usually the catalyst behind a transaction.
