Location: Buckinghamshire – near Dunstable Bedfordshire
Client name: Dr Martyn Ray Jones & Dr John Richard Bell
Sold Price: £1,250,000 Total No. of Offers: 20
Sale agreed within 4 weeks of marketing
Please tell us a little bit about the history of your pharmacy business; when and how you acquired the business?
In 2001, having been a 100% dispensing practice since it’s inception in 1985, we decided we were unlikely to successfully oppose, for the third time, a ‘predatory’ Pharmacy application in our practice area. We thus formed Edlesborough Pharmaceutical Services Ltd, enlisted the help of an old Harpenden friend – our favourite Pharmacist, as Superintendent and (he) submitted an application to open a Pharmacy in Edlesborough. This time we did not object !!
Obviously the application went through smoothly and we set about building a new wing to the Surgery to create both a Pharmacy and a Dental Surgery. We then set about finding an ‘in house’ Superintentent Pharmacist in 2002. This was the year that the Pharmacy degree course had been extended for a year and there was a death of Pharmacists , but the attractiveness of the challenge and the desirable locality helped overcome that difficulty. Mitul Patel became our Superintendent in 2008 and has made a roaring success of it.
What made you decide to sell the business?
Doc Martyn retired in 2012, and Doc Richard had plans to retire in the next year or two. We had not taken a dividend for years on the advice of our accountant – in order to benefit from 10% entrepreneurs relief at sale. So we had amassed a large cash balance – not earning a penny in interest. So the argument for sale became overwhelming – if nothing else before a possible change in Capital Gains tax law.
What were your concerns going into the sale process?
Obtaining the true value of the business on the basis that a a business (as is a house) worth only what someone is willing to pay for it and not what a valuation states.
What made you choose Hutchings to handle your sale?
If I remember, it was Nick Dansie’s recommendation. Hutchings handled the sale of Bridge Cottage Pharmacy in Old Welwyn in 2016 dealing with Dr Elaine Adams on behalf of the Dansie Practice. Nick (who’s coming to my 70th on Saturday) gave Hutchings a glowing recommendation, echoed by Elaine’s ‘thankyou’ letter to Hutchings of 29th June 2016.
How did you find the process selling with us?
Exceptionally well organised – you wrote a superb ‘Sales Memorandum’ and were very responsive to minor corrections and clarifications.
Do you feel there were any specific aspects or benefits for using Hutchings?
Howzabout exceeding our initial direct approach ‘final’ offer and memorandum ‘offers in excess of’ by 47%
Was our sister company Hutchings Accountants Ltd involved and if so how did that help?
No – we opted to stay with our own accountant who had intimate knowledge of the business and had never failed to give sound, informed advice.
What are you most looking forward to now that your sale has completed?
Finishing building my ‘top of the range’ B&Q kitchen and catching up with my life – weeding the overgrown allotment and digging up the spuds before they rot.
I have spent most of the last 14 months supplying information regarding the sale- Hutchings initial information gathering, then the dreaded ‘due diligence’ for the Solicitors, and then ironing out the inevitable sticking points consequent to any high value , complicated sale – not in the billions bracket, but complicated enough for a retired ‘jobbing’ GP.
Would you recommend Hutchings to anyone?
Yes, Yes and Yes again
Have you had experience in the past with business brokers like ourselves, and if so how do we compare?
No previous experience.
Is there anything else you would like to add that may be useful for pharmacy owners to know?
1) prepare for some serious work in the Due Diligence Enquiries
2) Allow at least 45 minutes- ideally an hour for ‘viewings’
A serious buyer will have memorised the Sales Memorandum and done their own research – but will still be looking for answers to other questions. I personally found the viewing process very rewarding and met some lovely interesting hard working Pharmacists. The successful purchaser in our case was our preferred purchaser – our Superintendent Pharmacist – and he was the only potential purchaser who did not have a viewing – but in retrospect, he should have had a formal viewing – it would have prevented a number of misconceptions which would not have arisen with the other prospective purchasers. At least he and we knew the other top offers he had to match.
Thank you to Dr Jones and Dr Bell for their feedback. We wish them the very best with their retirement and future plans.