Preddy Pharmacy Group Sale

Hutchings Consultants broker the sale of Preddy Pharmacy Group

The John Preddy Group of Pharmacies, 10 independently owned shops located across Sussex and the West Country, have been successfully sold to a family run independent operator in a deal negotiated by Hutchings Consultants. The deal was headed and negotiated by Anne Hutchings and Scott Hayton, Directors at Hutchings Consultants.

Background

Mr John Preddy and his company provided pharmacy services to various local communities across the South and South West of England during his successful 60+ year career in pharmacy. John’s first pharmacy was purchased in Newhaven, East Sussex in 1961 and he slowly built on this success through the following decades. This was achieved through a combination of the opening of new contracts as well as acquisitions of existing opportunities that presented to market. His most recent purchase was of Minster Pharmacy, Ilminster in 2007 and whilst several pharmacy units were strategically sold off along the way, by 2017 the Preddy group consisted of ten pharmacies. This was an important sale for us, both as a company and on a personal level because as independent business operators, we could sympathise with the challenges and decisions the Preddy family faced and we wanted to do whatever we could really to assist them in improving the business in the run up to the sale and ultimately boost the sale price for Mr Preddy’s retirement. Mr Preddy had been approached privately several years prior to our discussions with the family and a deal had originally been struck in 2015 to acquire the group. Unfortunately after some time and expense this failed to proceed. Following this distraction, at 88 years old and keen to realise his planned retirement, one of John’s family members, Donna Preddy, was drafted in to oversee some difficult changes in the company. This is where Donna and Jeremy Preddy (John’s son and daughter in law) first contacted us for some advice and guidance. We assisted Jeremy and Donna over the course of the following year before formally presenting the group to a selected number of buyers on a confidential basis. These were selected based on whom we felt were the most likely candidates looking at their funding capabilities, strategic objectives and ability to take over an operation of this size and nature. We also took into consideration whom the Preddy’s felt would be best suited to operate the business from a more personal perspective.

Donna and Jeremy Preddy said;

“Mr Preddy entered an agreement to sell the West Country shops in 2015, which never came to fruition. It was evident during this time period that the pharmacy industry was and is going through many evolutionary changes and the group needed a new infrastructure to grow with the changes. While family could help in the short-term, no one possessed the right skill set for the long term to grow and strengthen the group. Given the failed sale we’d already experienced, confidentiality was very important, as was a process to maximise value in a market where buyers were becoming more selective.  One of our key objectives was to sell as a group rather than have to split up into smaller pieces. Historically we had not used an agent but we decided early on that an agent was key for us to be able to run a tight sales process.  We became aware of Hutchings initially because of the book “Selling Your Pharmacy”.  Anne Hutchings came to us within days of contact to listen to our concerns and her business acumen was apparent from this point through to completion.  We quickly discovered that Hutchings understood our position, as a seller and their responsiveness to our questions, track record, and advice offered in selecting lawyers were some of the key reasons. The team also introduced us to many key players in pharmacy so we could start building the infrastructure to support the industry’s changes and become more marketable as a group.

Hutchings provided important introductions as we changed our legal advisors and they also introduced us to other pharmacy operators, which provided us with valuable insights, such as how to devise a staff incentive scheme, and controlling overheads in this challenging market.

We found Hutchings to be very ‘hands on’ and available and motivated to get a deal done while respecting our wishes as to how the process should occur such as using NDA’s before viewings. Anne Hutchings, Scott Hayton and the team were always accessible throughout the process.  No query was left unanswered.  They managed the process with potential buyers and interacted effectively between buyer and seller, arranging meetings and being available to participate in meetings at important points in the sale process.

Not having used a broker in the past, it was helpful to understand and be aware of the scope of potential buyers for our group so that we could devise a sales strategy, to eliminate certain buying groups and focus initial marketing on select number of buyer groups.  Once decided, Hutchings were proactive in contacting buyers and providing us with feedback. Prior to marketing the group, Hutchings Consultants gave valuable counsel and guidance preparing the groundwork for a smooth sale.  Prior to completion, Hutchings played a critical role as a point of contact for both buyer and seller to assist both parties to completion. We feel it would be hard for another firm to replicate the standard of personal service that Hutchings provided.

We would recommend Hutchings to other pharmacy owners without reservation. Mr Preddy has been able to end his longstanding pharmacy career of 60+ years on a positive note, knowing the business he cultivated is being developed for the future with another family run independent pharmacy group. We look forward to more family time with this peace of mind.”

Conclusion

Hutchings Consultants are delighted to see the sale conclude for the Preddy family.  Whilst no doubt it meant a full range of emotion, Mr John Preddy has finally realised his goal and can enjoy his retirement. Donna and Jeremy, who had personally invested a huge amount of their own time working to stabilise, improve the business (as well as oversee the sale and legal process on Mr Preddy’s behalf), can now regain the lives they were used to and can focus on family, a matter we know was very close to Donna’s heart in the final few months. For both Anne and Scott, the positive effect that getting this sale over the line will have had on the family’s lives is extremely rewarding for us. We wish the entire family the very best for the future and thank them for the opportunity to work with them and broker the sale of their longstanding family business.