Azets: increasing market proposition

Following the appointment of Jeremy Fearnley as Azet’s new group head of mergers and acquisitions (M&A), Fearnley discusses with Accountancy Today the geographical expansion the firm has planned, how he plans to increase the firm’s market propositions, and what the next steps are for the M&A team.

What attracted you to the role of group head of M&A?

As I spent more time with the senior leadership, I realised how much progress they had made since coming together in 2016. The move towards a harmonised business model applying leading technology solutions offers client teams data and insights to provide better client advice. This move towards a stronger advisory relationship offers a more interesting and fulfilling career – this resonated with my experience as a graduate and why I moved into Corporate Finance at an early stage of my career. 

Whilst there has been considerable investment in systems and processes, I could also see how much more could be done and that the leadership group understood the challenges and had a vision for the future. With that background, the opportunity to bring the M&A agenda to the board at a strategic level and continue to build and elevate the brand was very attractive.

What is your experience in the industry? 

I spent 18 years with a Big Four firm in the UK and China, progressing through the ranks to partner, with my last role being head of M&A in Hong Kong and Southern China. I left as I felt a limit to the opportunity to build a business and with no opportunity to create capital value within it. I wanted to be part of a firm which could advise clients, implement the advice, and then provide supporting business services to maintain and improve their business. I wanted an environment where people would invest in technology, drive best practice and innovate client service. Additionally, I spent the last five years in a private equity backed corporate and trust services group, which was originally a Big Four spin-out.

What are the multi-million-pound transactions you have advised on? 

Over nearly 25 years, I have seen pretty much every flavour of deal: from zero to $5bn (£3.74bn), Yorkshire MBOs to Chinese multinationals’ expansion, owner managed businesses selling to solve succession issues to global partnership mergers across five continents. It’s all about the people, and both the big picture and the details matter. You need to establish core principles for the integration and strategy and resolve detail up front before getting stuck into due diligence.

What do you hope to accomplish in your new role?

In line with our strategy, we will continue to strengthen our business geographically through the acquisition of strong regional platforms in our core of audit, accounting, tax, advisory and outsourced business services. We also have designs on building specialist industry services where we can bring the advantage of scale, data analytics, technology and workflows or integrations to create a unique proposition. 

Wealth management is a relatively nascent service line for the group and we see the opportunity to expand this nationally to provide a complementary offering alongside our advisory services, in order to support and protect the wealth of our entrepreneurs and business owners. We have an aim to double the size of the business in the next five years. 

What geographical expansion does Azets have planned?

We employ nearly 7,000 people across our UK, Nordic and European operations, which gives us the scale and reach to take advantage of the growth in our existing markets, particularly in the SME space, where there is increasing need for digitisation and quality advice. These markets are still highly fragmented and we will continue to acquire quality businesses to strengthen our position or add new locations or capabilities. 

That said, we are eyeing further international expansion in both continental Europe and North America, through the acquisition of strategic platforms, from which we will then work closely with the management team to grow and acquire other local firms.

What are your plans to increase the firm’s market propositions?

We are constantly reviewing our proposition to ensure we remain relevant to clients and able to guide them through their challenges. We also partner closely with other service providers which have propositions which are complementary to ours, for example financing solutions where clients can benefit from our aligned advice and leverage our economies of scale. 

We also look at service line solutions, and we see opportunities for different segments of the market. Though we have large multinational clients for distinct services, we are predominantly a SME service provider. This divergence means we have some clients who require a slick digital solution on one hand and others who prefer a “white glove” tailored solution on the other.

What criteria do you look for when acquiring new groups?

Number one is cultural alignment – we have to judge whether the business will sit happily within our structure, share our values and enjoy working alongside our colleagues. We do this by working closely with our business leaders who will be responsible for the acquired business when it comes into the group. We also want to see that we are offering a valued, strategic solution for the business and its people, particularly the next generation, and we spend a lot of time trying to understand and assess motivations and then create alignment through the deal structure.

Are there any particular groups the firm is currently eyeing?

We have a very healthy pipeline across multiple markets, segments and specialisms and are constantly looking to build relationships with businesses we admire. We also spend a lot of time reviewing the market and developments to ensure that we identify and engage with up-and-coming groups as early as possible.

What are the next steps for the company?

There is ongoing innovation and drive for continuous improvement in our operational and market proposition, and we are seeing strong organic growth as we continue to win work with demanding, progressive clients. We are driven to further develop our differentiated, advisory-driven service to the SME sector, who deserve and demand a different type of service from the traditional service they have received.

This wouldn’t be possible without the quality teams we have, in which we are continuously investing, as well as bringing in new talent across the board, from school leavers to graduates, to established professionals with decades of experience. On the M&A front, we are focused on executing on our existing deals and ensuring a successful integration – putting the people first.

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