AI Magazine Issue 1 2017

Acquisition International - January 2017 59 2017 – Uncertainty or Opportunity for M&A in FM? companies are low as contract pricing is tight and extremely competitive. One unknown factor which might also impact on these margins is how Brexit could affect the supply of labour to fulfil the contracts, especially in the unskilled workforce. Will the potential cut in immigrant labour to the UK make a difference? The minimum wage here in the UK is also rising, how will that impact on the bottom line? Potential investors will be looking closely at how their target purchases are preparing for these events. Potential investors, whether domestic or foreign, could also be looking at the company’s client base, growth prospects and fit with their own strategic business. Investors are now looking at integrated FM companies and how to expand their potential and this can be through the creation of stand- alone divisions for some of their key departments in an effort to make them more entrepreneurial and flexible, to maximise every business tender opportunity and deliver a wider profit margin. With such competition for contracts between companies with similar offerings, creating stand-out specialism could be one way of differentiating themselves. Examples could be creating a catering division which offers specialist food; security divisions should aspire to the highest licensing and professional levels and contemplate the inclusion of their own dedicated level two ARC centre; car park management needs to embrace mobile and latest technology to ease ingress and exit, booking and location of spaces and display availability; business removals and relocations services are another key opportunity….and all of these facilities can be sold in as separate income streams, or included as part of a total FM package. Property development will continue and the Internet of Things (IoT) in all parts of people’s lives will develop apace, controlling their workplaces and the built environment and the challenge for British FM companies over the forthcoming years is to harness the power of technology and embrace the investment offered to do this. For those looking to invest in a sector which offers recurring revenue, once again the UK facilities management sector offers unrivalled opportunities in the post-Brexit era. Uncertainty in today’s business climate, can simply mean opportunity.