Livingbridge Executive Summary

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The recommendation for Livingbridge is investing in ADAS. This recommendations is a secondary Private Equity investment and the thesis behind the recommendation is explained below.
ADAS is UK’s largest independent agricultural and environmental consultancy firm, with +450 employees. The company is headquartered in Wolverhampton and has a balanced private and public customer base, which has helped them reach a revenue of £31m in 2014.
Regarding growth opportunities, environmental consulting services grew 5% in 2014, with key competitors growing close to 10%. The sector is growing rapidly due to stricter environmental requirements for stablished businesses, green infrastructure growth and planning permission need for renewable projects. ADAS’ …show more content…

Livingbridge investment should support the company’s business plan for organic growth and a carefully targeted acquisition strategy to increase exposure to strategic markets. Additional value upsides may arise in other European countries adjusting to the environmental changes.

Some potential risks are energy sector volatility, competition for skill consultants, and pension liabilities. Livingbridge has previous experience in similar deals: in 2004 Livingbridge invested £4.85 million as part of a £13 million investment in SLR. Mitigation plans should be targeted to increase the customer base diversifying specific risk volatility, introducing skilled management team to manage pension liabilities and retain key employees.

ADAS current private equity (PE) ownership (PE backers are Sephton Park Capital and ARCIS Capital ADAS) generates an business opportunity due to their exit need on this deal, although it also makes the transaction more complex. However building on Livingbridge expertise in the field and managing risks appropriately, would provide a strong business opportunity for Livingbridge. Moreover, recent news show the PEs backing ADAS have not had successful results exiting the company, which may create a lower entry cost. Nevertheless, thorough research and due diligence should be executed to confirm business value