The critical problems facing company owners today

There are significant barriers for owners in trying to grow their company or to sell it.

Business Discussion Talking Deal Concept

Inability to sell your company.

In the European Union, 3/4 of all SMEs that are for sale never, ever find a buyer. This is deeply worrying as most owners see their business as their pension.

Bundle of dollars in purse and hand on beige background

Company debt and personal guarantees.

Many companies have high levels of debt and it’s common-place for banks to insist on personal guarantees, usually over the owner’s home. The stress of this can affect their health and relationships, and also the ability to focus on growing the company.

Thoughtful Businessman Portrait

New owners inadvertently destroy the company.

After selling your business, the new owners may change the company name, how it operates, the culture, the contracts with everyone and end up destroying it.

Gold.

High cost to sell a business.

Firstly, you have the intangible cost of endless meetings, emails and calls. Then you have the tangible costs of accountants fees, attorney fees, valuation fees and tax. Tax alone is typically 25% or more of the consideration.

African businessman working on laptop at cafe

Lack of capital to grow your company.

Lack of working capital is the single, most challenging barrier to a company’s expansion and growth. Lack of CapEx to execute plans designed to break-through their “glass ceiling”, perpetually stifles a company’s growth.

Business Cafe Colleagues Enjoyment Teamwork Concept

Lack of exit options

It is extremely difficult for a small business to find a willing buyer. Even if one can identify such a buyer, hardly any will pay all cash up-front, preferring earn-outs over many years based on extremely challenging targets.

The Opportunity

There are over 30 million Small to Medium-sized Companies in the EU and a further 6 million in the UK, with many owners needing our help.

Iconetic PLC t/a “The New Icon Group” is a Luxury focused conglomerate acquiring companies in 4 key areas of Luxury: The Yachting industry, Private Aviation, Food and Beverage, and any Luxury B2B/B2C provider.

We aim to tap into the pent-up demand for company owners to find alternative solutions to some of the myriad of problems they face day-to-day and to help them solve their operational barriers to growth, wealth, and dare we say, happiness? 

We will acquire companies as part of New Icon, which will undertake a Technical listing on the London Stock Exchange. Owners wishing to sell their company will undertake a simple Share-for-share exchange with us.

Luxury boat yacht anchored in a bay of tropical Island

The solution?

Iconetic PLC will shortly list on the Standard Exchange segment of the London Stock Exchange. We follow Warren Buffett’s methodology in acquiring companies by undertaking a full share-for-share swap so that owners will subsequently be holding tradeable PLC stock to the value of their business. For example, if your company in the UK or Europe is worth 5,000,000 post-acquisition, you will now hold the same amount in our PLC stock to then sell.

The benefits

Money Rose Grows

Access to capital

The ability for a PLC to access capital markets and to offer our members invaluable operating cash is a game-changer for SMEs when other sources dry-up in a crisis.

superyacht

Exit

Owners face the real risk of never finding a buyer for their company, potentially going round the carousel forever. In our model, they can simply sell their shares and get off the motorway when they wish. Having shares in our PLC also aids succession planning for their families.

Man wearing suit moving the queen piece lifting it up in his fin

Spread of risk

Having a global outlook reduces any macro-economic risk. If there is a downturn in one sector, country or indeed an individual company, New Icon will be insulated as a group of companies due to our diversification and also by having a large, growing number of companies. As we frequently add more profitable companies to the group, we do anticipate a strong increase in our valuation to the benefit of all.

Business Brainstorming Graph Chart Report Data Concept

Competition

In the event of substantial appreciation of the company’s share price, owners could potentially use their shares to buy-out competitors and profit from their growth.

Young woman in a sea cruise

Lonely at the top

Owners can often feel alone in their day to day struggles. New Icon Group will hold regular meetings and social functions for all member company senior management teams to facilitate networking and foster a sense of collectiveness, as well as CEO-only roundtable meetings to discuss high level joint strategic plans and event-driven situations. This mentorship and meeting of peers will encourage the sharing of ideas, contacts and mutual assistance and ideas will naturally propagate and might even create economies of scale.

cropped view of person stacking coins on table on blurred green background

Tax savings

Selling a business crystalizes a Corporation tax gain of 15-20% in the UK, and individual shareholders may also be taxed on their holding. In a share-swap transaction, there could potentially be little corporation tax at all to pay, as the Inland Revenue (HMRC) treats a share swap as a non-disposal. This could potentially save a business a very substantial sum of money, as well as individual shareholders. It should also be noted that the IRS in the US also has a similar stance as HMRC’s, and we feel this is possibly common in many countries.

Banking Credit Card Money Concept

Clear debts

Owners will now own shares in our PLC, which can, in turn, be used to pay off company debts and get rid of any personal guarantees. Without the ever-worrying fear of debt-related payments, we believe owners will truly be set free to focus on growing their business.

Handshake Businesswoman Colleagues Deal Concept

Procure large contracts

As part of a PLC, owners can now pursue larger contracts/tenders/opportunities which sometimes require upfront bonds or bank guarantees or performance bonds as part of the bidding process. Member companies can also leverage our network of talented people across the group to expand, and can also point to themselves as part of a PLC.

Business Cafe Colleagues Enjoyment Teamwork Concept

Alternative to venture capital

Our solution provides a viable alternative to venture capital by a liquid, tradeable financial security that can potentially be used as collateral to raise money. This allows owners to keep their shares as opposed to diluting ownership away to VC investors.

Young successful businessman checking emails while having morning coffee

Owner management

Owners will continue to manage and grow their business as we have a very much, “hands-off” approach comparable to Warren Buffett’s approach to identifying the right teams with the right business models and leaving management teams to do what they do best.

Business Man Handing Out Report Restaurant Table Concept

Sell shares

Owners will be able to sell an agreed portion of their shares which we anticipate being 20-25% annually and release some capital after considering any stock market stipulations. Owners can now have that capital event that they have always been searching for which will allow them to pursue their life-long ambitions as well as enjoy the retirement that they truly deserve.

If I was a flower growing wild & free.

Expand

In becoming part of our PLC, owners will now have the resources to reduce their operational risk and attract better quality talent, freeing them to concentrate on expansion.

Group Of People Drinking Coffee Concept

More rewards

We will implement an incentive scheme for owners to grow their business so that out performance is suitably rewarded with new shares and/or dividends. This will motivate all to be fully focused on the growth of the company and be rewarded for outstanding performance for the long term.

Happy family lying together

For your family

 Shares are heritable, which can aid succession planning for families.

Aerial view, sailing yachts, motor yachts, Croatia. Sunset

The typical companies we seek to acquire

We are neither country nor sector specific and having a global outlook reduces any macro-economic risk.

If there is a downturn in one sector, country or an individual company, we will be insulated due to our diversification and a large, growing number of companies. We prefer to focus on companies involved in the Yachting industry, Private Aviation, the Food and Beverage sector and any Luxury focused B2B/B2C providers.

Ideally, they should have low debt and their present structure and model should be simple, easily understood and have a consistent operating history. The company should have good long-term prospects and ideally consistent returns.

Owners should have a focus on return on equity and be candid and open with our executive board. This approach has worked for decades for Warren Buffett and we shall largely follow his ‘tenets’.

The acquisition journey

An overview on the steps you go through

THE FIRST LANDMARK

MONTH ONE
Signing a non-disclosure agreement (NDA)
After signing a Non-Disclosure Agreement (NDA) we take an initial dive into the company’s financial statement/accounts and undertake due diligence. The NDA protects both parties from disclosing anything sensitive.
MONTH ONE
MONTHS ONE - SIX
Financial due diligence
We need to see the robustness of the accounts and the business in general, at an early stage. As previously mentioned, we have certain expectations on financials so it is important for us to ‘pop the bonnet’ and see what’s in them to avoid any disappointments.
MONTHS ONE - SIX

THE SECOND LANDMARK

MONTHS THREE - SIX
HOA (sign the Heads of Agreement)
The second landmark will be to sign the Heads of Agreement (HOA), which is non-binding and aims to outline the concept expectations in detail. At this stage we would ask the company to produce a business plan.
MONTHS THREE - SIX
MONTHS ONE - TWELVE
Regular meetings
We would then meet a few times over the coming months to get to know our respective businesses and naturally one another socially.
MONTHS ONE - TWELVE

THE THIRD LANDMARK

MONTHS TWO - SIX
Formal agreement
The third landmark will be to sign the formal Agreement to undertake the share swap. Immediately prior to this, the owner will be expected to provide a company audit which we will use to value the company.
MONTHS TWO - SIX

THE FOURTH LANDMARK

MONTHS SIX - TWELVE

The float

The final landmark is when we formally list or ‘float’ which we have provisionally slated to be early 2022.

Articles & news

From our blog

Contact us

Get in touch

We would love you to get in touch with us, even if it’s just to ask us some questions. We are here to help. Drop us a line and we’ll aim at responding within 24hrs.

 

Our Address

C/O LK Shields
40 Upper Mount Street,
Dublin