The story between Leith M&A and both Churches Fire and Security and Detect Fire and Security is a complex one spanning nine years. It also demonstrates the unpredictable nature of the business sales process and the variety of ways Leith M&A can advise and support both the buyer and seller, depending upon their requirements.
In 2012, Andy Derrick and Chris Ellis, the shareholders of Detect Fire & Security approached Leith M&A after making the decision to grow their business through acquisition. They were keen to expand Detect’s geographical reach and also their client base from a predominantly commercial one to include the residential market. Leith M&A and Detect entered into an agreement on a tailored search basis with Leith working to research the fire and security market across the south-east of England and following that, make approaches to suitable target companies.
As part of their research process Leith M&A approached Oakpark (Dorset) Limited, a Dorset based electronic fire and security provider. Oakpark were an attractive prospect as they were based in Dorset, therefore widening Detect’s current geographical range from their current base in Hampshire. They also served the residential market so would also expand their client demographic considerably.
In early 2013 Detect made an offer to acquire Oakpark and subsequently Leith M&A was set to support the companies through the complexities due diligence process; however the deal was not completed at this time.
This exercise had piqued the interest of Oakpark’s shareholders, Jeff and Val Pearce, who then came to the decision that they wished to continue the process of trying to sell their Company; with this is mind they instructed Leith M&A to work this time on their behalf to sell their Company and in February 2013 entered into a contract with Leith M&A.
Leith M&A began the research process to unearth potential buyers within the Fire and Security sector, many of whom Leith M&A had made previous contact with and had forged good relationships with the senior decision makers. Leith M&A made approaches to 49 companies signing NDAs with 16 of these targets. There were various conversations with potential buyers for our client which at that time did not come to fruition, unfortunately not garnering an offer with the right value for Jeff and Val.
Sometime later, the shareholders of Detect re-ignited their interest in Oakpark as a possible acquisition, returning to the table with a renewed offer.
Leith M&A supported Jeff and Val as they made the decision to enter into discussions with Detect which this time culminated in the signing of the Heads of Terms agreement in December 2013 and subsequently the SPA in February 2014 and the swift completion of the sale.
Jeff and Val Pierce shareholders of Oakpark (Dorset) Limited commented at the time,
“With the final completion of the sale of my Company, I would like to put on record my thanks for the excellent work done by yourself and your team in achieving a successful conclusion to the negotiations in, what is currently, a difficult market. Throughout you have kept me fully informed of progress and could not have done more to achieve our desired result. Were any of my business acquaintances considering selling their own businesses I would not hesitate to recommend they use your services.”
Chris Ellis and Andy Derrick, shareholders of Detect Fire & Security also commented at that time,
“We appointed Leith M&A to research and then approach competitors enticing them with our potential for acquisition. David Nelson was attentive to necessary details and appropriate questions ensuring focus on valid targets. After our campaign had concluded a business that David as their agent. David assisted us with the diligence process, the legal framework, and the sale/purchase agreement too. David remained attentive to every aspect of the transaction, which was out first acquisition. Always acting fairly and taking a balanced approach to the inevitable challenges that naturally arise during the process.”
David Nelson and Chris and Andy from Detect kept in communication in the following years, and David was delighted to hear of the on-going success of the combined ventures.
As an active M&A sector, David Nelson fostered excellent relationships with several companies in the fire and security sector. In August 2020 David Nelson went on to advise the shareholders of Elite Fire & Security (www.eflfire.co.uk) on the sale of their business to Churches Fire & Security.
It so happened, that around this time, the shareholders of Detect were also considering the sale of their business having built the company to the existing point but keen to see Detect continue to grow under the umbrella of a larger firm. Through conversations with David it became apparent that Churches could be a potential buyer for Detect. As Andy Derrick joint Managing Director of Detect comments,
“Some years later, when we determined to sell our own business, David at Leith M & A was an obvious choice and very quickly connected us to potential buyers, but with one in mind especially. Again, David was meticulous with details and took upon himself much of the load through the diligence and disclosure process. Never tiring with his support and often beyond conventional work hours David’s focus and devotion acting on our behalf was peerless. I believe that David secured us the very best deal, provided immeasurable support and encouragement, for which we remain deeply grateful and recognise that we couldn’t have done with without David and his excellent team at Leith M & A.”
David approached the M&A Team at Churches, in 2020 with the proposition and again worked with Churches on their acquisition this time of Detect Fire & Security. The process concluded in the summer of 2021 with the successful completion of the sale throughout the particular challenges of that year.
Charlie Haynes, Chief Executive Officer at Churches Fire & Security commented,
“Following the acquisition of Detect Fire & Security, I am delighted to welcome our new colleagues, customers and suppliers to Churches Fire & Security. This is the 32nd acquisition Churches Fire & Security has made and as we integrate the acquisitions, we are always pleased not only to grow our business but take the best from both businesses. This helps ensure we continue to develop and grow our offering, as we continue to work with our customers to keep their property and staff safe from fire and theft.”
David Nelson, Managing Director at Leith M&A added,
“I have very much enjoyed building an exceptionally close relationship with Chris and Andrew over many years, we’ve certainly been on a unique journey together. Leith M&A first acted as their acquisition advisor, then on “the other side of fence” as we represented the shareholders of a company they acquired and finally supported them in their own exit. It has been a wonderful experience to work with them and experience the M&A process from all angles with the same client.
We are particularly proud of our role in the final stage of their journey, and we are delighted to have secured an excellent deal for Andrew & Chris. They built a fantastic business in Detect Fire & Security and a lasting legacy that they should be very proud of.
I would also add that it has been a pleasure to work opposite the team at Churches Fire & Security once again, our second sale to Churches Fire & Security in just seven months. Their approach has been professional and transparent from our initial meeting through to completion and this helped to facilitate a smooth transaction.”
What challenges arose? How did you navigate them?
The process of selling a privately owned company to a FTSE listed company is always fraught with challenges. The cultures of privately owned companies and large corporates differ greatly and this can have a substantial impact on the ‘marriage’ process. Nonetheless, we were able to complete this deal just seven months after our initial meeting taking our Client’s Company to the market and six months after signing the NDA with the buyer. Looking back, this deal was in actual fact relatively straightforward despite some last minute, late night negotiations on the finer points of the share purchase agreement.