Lawyer Monthly - February 2023

TRANSACTION INTERVIEW 83 With the global backing of Questel, we think the Equinox software will grow from being the largest UK law firm IPMS to a top five provider for law firms and small corporates globally. being in direct competition with a billiondollar corporate. We co-created the acquisition strategy with the Equinox directors. We documented the red lines for them, how we saw the valuation, the way we would pitch the company and the potential acquirers. Knowing that due diligence would be needed later, we kick-started the preparatory work to streamline the transaction and maximise value. Why are Ahead Business Consulting wellpositioned to advise on acquisitions of this nature? What skills did the team bring to the table? Our work fell into three phases. In phase 1 we identified the immediate challenges, set the strategy, and implemented it. Without making significant changes to the operation of Equinox, the company would not have shown its true value. The Equinox board would have lacked the information, analysis and support to make a decision to be acquired. In phase 2 we acted as intermediary between Equinox and potential buyers. This freed up management time and created negotiating space. A negotiating intermediary can have frank conversations, signal direction and pause to collect information which the management team would feel necessary to provide immediately. Due diligence is a project in its own right, which typically requires the creation of a lot of material. We managed this process, creating forecasts, planning, providing analysis and ensuring the information provided was complete, timely, without conflict and accurate. Were any challenges encountered during the course of the acquisition? How were these overcome? The biggest challenge is about the people. Equinox is a young management team, selling a company for the first time that they have nurtured for 15 years. It is incredibly emotional and stressful, but at the same time they needed to focus on the key indicators that drive their valuation. Together with Ward Hadaway and Azets, we managed to dial down the stress through good planning, strong communication and pragmatic advice. Managing expectations is also key. Complex deals take time, especially with an overseas acquirer and turbulent financial times. There are several stakeholder groups to consider, including Equinox’s wider shareholders and staff. In our strategy work we wrote down a core value: “Equinox is a totally cool place to work”. That ethos is central to the way management behave and drives the culture. It is vital that the way the deal was set out preserved that ethos. What impact do you anticipate the success of this merger to have on the IP sector in the UK and overseas? Over the next few years, we expect widespread consolidation in the broad innovation space. Market research has predicted growth of threefold between 2021 and 2028, driven by a combination of a continued rise in patent filings and the rising costs and risks associated with inefficient IP management. For Questel and Equinox, we see a very bright future. Many competitor IPMS products are close to their end of life, with providers struggling with rising costs of maintenance and a reluctance to deliver new features. Corporates with in-house IP divisions and law firms will face rising IT and staff costs, making it increasingly sensible to seek efficiencies. With the global backing of Questel, we think the Equinox software will grow from being the largest UK law firm IPMS to a top five provider for law firms and small corporates globally. Do you expect that Ahead Business Consulting will advise on further transactions of this nature in 2023? We help businesses all over the UK boost their potential. We resolve problems, unlock new thinking and bring ideas to life. We focus on the power of people to achieve change for better. This year we expect half of our engagements will require external investment or acquisition to achieve change. A proportion will be acquisitions, while others will be equity or loan investments. The mix will be governed by market conditions, but in all cases Ahead Business Consulting will bring fresh focus and new insights.

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