Howard Weston of Lucas & Weston business broker, is to offer a unique insight into the business sale process during the Buy A Business Masterclass event, which is being held at the London School of Economics (LSE) on 26 January 2012.

Anyone hoping to attend the even, who wants to buy a business will be given the opportunity to gain an insight into some of the 168 deals Mr Weston has played a part in negotiating. Attendees will be able to view a deal from a buyer’s perspective, offering a rare glimpse into how deals actually take place and how negotiations progress.

Mr Weston will cover a number of topics during the seminar, which will all be of interest to those looking to buy businesses. Where to find a business for sale, including those that are never advertised, will be examines, while handling unrealistic value expectations and ensuring you are taken seriously will also be covered.

Chris Bowen, the CEO of Taylor Bloxham, was one of the former attendees who found the event useful when he became involved in negotiations himself. He said, "It was very useful to me with loads of practical stuff that I can use immediately to secure a better deal."

Weston said he will offer his views on some of the more memorable deals he has worked on, including case studies of some of the most successful business purchases, money-saving tips and hints on the right types of questions to ask to gain respect and control during negotiations. He will also take questions from the floor and deliver frank answers.

Special discount still available for bookings made before 23 December 2011. Visit the website for details or call 01225 460777 for tickets.

Analysis of business transactions in the South Yorkshire region has indicated that the second half of 2011 is likely to see an upturn in the number of business deals being carried out.

The research, carried out in advance of the South Yorkshire Dealmakers Awards, has shown that many of the corporate finance advisers shortlisted for the awards are looking forward to a more buoyant period ahead.

The research was conducted by the editor of The Insider business information magazine, Richard Abbott, who sought the opinions of many of the region's top business brains.

Victoria Gribben, the director of Streets Corporate Finance, said that there were many more start-ups with working capital requirements, but there were also businesses that had been considering selling two or three years ago, but had traded out of the recession and returned to financial security.

"It is promising to see a phoenix of entrepreneurial spirit in the aftermath of a difficult couple of years," she said. "Businesses are stepping out once more and engaging in transactions."

David Forrest, from BHP Corporate Finance, said that there remained an element of caution from banks in funding any form of leveraged buyout, there would be a steady flow of acquisitions where the buyer is consolidating, making strategic acquisitions or picking up a distressed business.

Should entrepreneurs and business owners around the UK expect more from the 2011 Budget than a reduction in red tape?

It certainly ought to deliver more for the business community to justify its ‘Budget for Growth’ moniker.

The final report of the Office of Tax Simplification (OTS), which reviewed the UK’s tax reliefs and allowances, concluded that ‘whole areas of tax law are particularly complicated’ and that ‘many areas may need a more in-depth review’.

One of the central recommendations of the report is to merge national insurance contributions with income tax. But of particular interest to entrepreneurs and investors is the recommendation that conditions for investing in Enterprise Investment Schemes and Venture Capital Trusts should be standardised and simplified.

What will be interesting to see is whether EISs will be extended. At present investors in an EIS enjoy 20 per cent tax relief on up to £500,000 of investment in an approved business that has less than 50 employees and gross assets of under £7 million. Many would like to see the relief extended to those people who provide loan funding to businesses, an increasingly popular source of capital since the banks have virtually closed their doors to business funding.

But what of Entrepreneur’s Relief, which of course was never as simple in practice as it first appeared when introduced? The report echoed the sentiments of business groups that it ought to be simplified and extended to those investors holding less than five per cent of the company, currently left out in the wilds having to fork out 18 per cent capital gains tax on sale of the company.

What we would really like to see, which would get serial entrepreneurs working again, is the removal of the £5 million lifetime limit of Entrepreneur’s Relief. This would be, in effect, a move back to the very conducive incentive of business taper relief, which ended almost exactly three years ago.

Update 23rd March, 2011: Entrepreneur’s Relief to double to £10 million

A travel centre based in Hagley has been purchased for an undisclosed sum by Good Travel Management, in a strategic acquisition deal.

Good Travel Management, which is headquartered in Hull, has acquired Mercian Travel Centre in a bid to open new markets for the company in the Midlands and the South of England.

As a result of the acquisition, the travel group will now become the sole shareholder in Mercian Travel Centre, following the retirement of its former owner – and founder – John Downing.

Good Travel Management has been trading for 120 years and this purchase marks the first time it has expanded beyond its local area. Specialising in tour operations, trade missions, business travel and high-end leisure travel, the firm is particularly well known for its expertise in arranging trips to the Middle East and Libya.

General manager at Good Travel Management, Kevin Harrison, said, "We are very pleased with this acquisition because Mercian Travel Centre is an extremely good business.

"The firm has experience in a host of travel sectors similar to our own, so it is a good fit with our business. Its record in delivering trade missions was of particular interest because we have been increasingly specialising in this area and the acquisition strengthens our offer," he added.

It has been confirmed that Mercian Travel Centre will continue trading under the same name and all members of staff will be kept on.

The Electrical Contractors’ Association has warned that business owners who are keen to sell up and enjoy their retirement are finding it increasingly tough to find buyers.

A variety of reasons lie behind the lack of buyers, including continued tight bank lending, public spending cuts and the uncertain financial climate.

The scarcity of willing and able buyers opens up numerous opportunities for those with cash who can move fast. There are currently numerous businesses up for sale at bargain prices and owners – especially those looking to retire – may be willing to do a good deal.

If they are unable to sell up, many owners who are approaching retirement are now being forced to close down their businesses in order to release some money, or alternatively must continue to run the business for far longer than they would have liked.

President of the Electrical Contractors’ Association, Diane Johnson, said, “Some of them are saying they are closing their businesses down. It is not in the hundreds but it’s definitely more than normal. They are closing them down because they can’t find people to buy them, because the people working for them can no longer raise the finance.

“If you go to the bank, they are asking, 'what’s your order book like for next year?’ Some companies don’t have order books beyond the next few weeks,” she added.

Whereas in previous years, family business owners were prone to taking some equity out of the business and handing it over to their staff. However, with the ongoing economic situation, increasing numbers of staff are now unwilling to take on the business as they are concerned they will not be able to realise the necessary cash needed to do so.

Ms Johnson added that confidence has undergone a severe knock due to the sweeping public spending cuts.

For those that are looking to make acquisitions, the lack of other buyers in the marketplace – and oversupply of owners keen to sell up – could provide the perfect opportunity – at a knock-down price.

Last week, another report demonstrated that the stream of press announcements from UK banks about ‘turning the tap back on’ business lending is nothing but empty rhetoric.

The Centre for Economics and Business Research (CEBR) found that lending to small businesses, with less than 200 employees, dropped 4.5 per cent this year. Now this is compared to 2009 lending figures, which were very low in any case.

Despite calls from the government for the banks to release more funds to the illiquid small business sector, it is being stymied by the banks reticence to comply for fear of breaching stringent new capital holding requirements being brought in by the EU.

Businesses have to face the fact that they are going to fund their growth, whether organic or through acquisitions, with their own cash or other means.

Not everyone of course is in the fortunate position of having a large cash pile with which to buy businesses. The Business Sale Report has several dozen very prolific subscribers with substantial in-house reserves that each purchase a distressed company virtually every month or two, and are building up sizeable companies without huge cash outlays. On purchase, they invariably trim off unnecessary elements of the business, often administrative or IT functions that can be handled centrally. The businesses are either left to run under their existing brand/company name or are consolidated under the group brand.

For those without cash reserves, the gradual recognition that funding from banks is still difficult to obtain is prompting many business owners to tap into family, friends and other directors as finance sources. According to research by the Forum of Private Business, while only 10 per cent of businesses owners sought funding from private sources in 2010, a huge 45 per cent were anticipating to do so next year.

Another source of funds moving into prominence is asset-based finance, which has grown by 11 per cent since last year, according to the Asset Based Finance Association. In the last quarter, over £15.1bn has been raised through asset-based finance. This increase is complete contrast to bank lending figures, and shows that small to medium firms are becoming more resourceful in seeking alternative avenues to finance business acquisitions.

Equity and angel finance is also set to increase its share of the total funding pie. It is common knowledge that a far greater proportion of businesses in the US are funded by business angels or venture capitalists than in the UK. Estimates suggest there is somewhere around £4bn of angel funds already in place in this country, ready to be invested into companies that have scope for expansion or consolidation.

What more can the government do? There are two main areas that interest groups are focusing on – 1] calling for the government to further drop the corporation tax from its new level of 20 per cent that comes into effect next year; and 2] extending the Small Firms Loan Guarantee Scheme which is due to end on 31st march 2010. This enables companies with annual turnover of up to £25m to obtain government-backed loans of up to £1m.

Another idea proposed in a paper recently by Equity Development is that the government should drastically simplify and reduce employment law rules for business that have less than 20 employees.

You cannot hold back ambition, and many businesses are determined to pursue a growth strategy through diversification and consolidation of competitors at a time when organic growth is difficult to achieve. With company insolvencies continuing at a rapid pace, and with no end for the trend in sight at least for the next twelve months, the business opportunities for savvy entrepreneurs with funding solutions in place are clear and numerous.

Former Dragon, Richard Farleigh, reckons that now is a crucial time to be doing deals, because so many promising ventures are short of cash.

Speaking at the opening of the new London City shopping complex, One New Change, the entrepreneur said “At times like this, you have to be investing, rescuing things and doing good deals.” He added, “There are a lot of businesses out there that can’t get funding and they are relatively low risk.”

Farleigh’s preference is to invest in business models that are disruptive and where he can have a direct influence in the company strategy. He likes new and innovative product ideas, which don’t have competitive pricing issues and can have a lion share of a new or niche market.

Jeremy Harbour, an entrepreneur who has bought and sold around thirty businesses over the last ten years, likes to structure acquisition deals in such a way as to require little upfront capital. Half of Harbour’s acquisitions have focused on distressed or insolvent businesses, and this is an area he clearly feels comfortable with. One of his ventures, The Harbour Club, teaches business owners how to buy and sell businesses.

Many entrepreneurs are buying businesses in a bid to jump out of the dull trading conditions that have stymied turnover over the past few years. There are many entrepreneurs that realise that they are best able to achieve the excitement, stimulation and wealth expectations they have set themselves by purchasing other companies rather than treading the long road of organic growth.

Another entrepreneur recently featured in the Financial Times, William Sibley, has picked up two companies in the last two months and is now negotiating a third for his facilities management business. His combined business turnover will reach £7.5 million this year, but planned acquisitions are expected to double this figure next year. Sibley looks for acquisitions to increase his geographic reach and also to quickly bring in staff that have skill-sets that he doesn’t already have in place.

New research from a company listing businesses for sale has highlighted the general consensus amongst business brokers that transaction volumes won't return to pre-recession levels for more than 18 months at least.

BizBuySell, a website which lists businesses for sale across America, has surveyed brokers about the state of the businesses-for-sale market and found that the majority – 52.6 per cent – remain rather pessimistic about the recovery of the sector.

One poll respondent said, “I don't believe we will in the next 10-15 years see 2000-2007 activity.”

This shared belief that the market remains challenging is shared by brokers and business owners in the UK too. One of the greatest concerns is a scarcity of qualified buyers, with brokers reporting that they are receiving fewer buyer inquiries this year than last.

Other concerns include a challenging market in which to get deals done – the majority of brokers say it is taking longer to close a sale this year than last – alongside a lack of evidence pointing to a fast recovery, which could be putting some buyers off.

Mike Handelsman, general manager of BizBuySell said, “The results [of the survey] unfortunately show that there are still many challenges and high levels of uncertainty in the business-for-sale market.

“Deals are still getting done, but business owners looking to sell in this market might need to be flexible and share the risk with potential buyers by offering seller financing,” he added.

Figures out today from the Office of National Statistics reveal that the UK economy surged forward in the second quarter of this year, exceeding expectations of the City. The growth in GDP ran nearly twice as fast as most predictions, led by a most surprising return to fortune of the construction sector.

The service and manufacturing sectors also enjoyed a stellar performance, allaying fears of a double-dip recession, boosting markets and providing sterling some extra bounce.

There is, of course, concern that the government’s fiscal tightening will not allow this growth to continue at the same rate in the midst of continuing sovereign debt worries.

The continuing value in sterling on the international scale and low earnings multiples currently being struck for business sales in the UK have resulted in a window of opportunity for shrewd acquirers, particularly in beleaguered sectors on the cusp of recovery.

Private equity players have increased their activity substantially in the first 3 months of this year compared to last year. In fact according the Centre of Management Buyout Research at Nottingham University (CMBOR) the £5bn in deal value in the first quarter of this year was more than they managed in the whole of 2009. However, the total deal volumes are eclipsed by the buying frenzy in the boom years where £20bn worth of buyouts were completed in a single quarter. Interestingly there has been increased activity in the UK compared to the US and Europe where private equity is still in the doldrums.

One reason for the increased levels is the growth in the secondary buy-out market where one private equity house sells to another. This accounted for three quarters of buyouts by value in the first quarter. Recent secondary buyouts include the Clayton Dubilier & Rice’s £400m buyout of British Car Auctions from Montague. Apax partners £975m purchase of pharmaceutical distributor Marken from Intermediate Capital Group was the third time that the business had been owned by a private equity house. These sort of deals where businesses are sold between private equity houses has been criticized as investors often have holdings in both the buyers and the sellers and the investors sometimes has the same asset as before but with fees and profit share taken out.

According to Christiian Marriott a director of Barclays Private Equity that sponsored the research by CMBOR said that many private equity firms have large amounts of capital that they need to deploy and this has lead to a more active market. However, some worry that this need to deploy capital has increased competition for assets and hence prices have started to rise. As such, the prices may not be sustainable. However, new capital requirement rules for banks could restrict lending for private equity deals in the future.