THE SECRETS BEHIND THE BEST DEALS IN THE SECTOR PRESENTED TO: FUTURE WORLD LEADERS IN RECRUITMENT Presented by: J SLIPPER Date: SEPTEMBER 2016

DISCLAIMER Some names and identifying details have been changed to protect the privacy of individuals !

AGENDA My background Making your asset attractive Valuations Deal how I fell into recruitment? Roles & results Making your asset attractive Valuations Deal Pre-deal thoughts during the deal thoughts Conclusions

EBITDA -high single digit SWIFT EBITDA 6/8x, Gresham MM 2x IRR- low [sell side] Staffgroup EBITDA -high single digit Phaidon EBITDA- +6/7x multiple [sell &buy side] MY BACKGROUND Qualified ACA +20 years PQE Deals experience: Boutique; Big 4 - director PE - partner Management - C suite Private equity - Gresham C Suite Recruitment Swift - Oil and Gas recruiter; Staffgroup; and Phaidon International

DEAL SECRETS – Make it an Attractive Asset What is the story? Increasing the value through everyday decision making Enterprise Value = profit x multiple With every decision, does it increase my profit, my multiple or both. And in the right time frame!

DEAL SECRETS – Make it an Attractive Asset Examples of increasing value Source: Deloitte, Phaidon International

DEAL SECRETS – Valuation = Art not a Science Enterprise value = profit x multiple XXX Less debt (XX) Add cash X Equity value XX Lets explore each of those ( view changes depending where sit on deal) Profit – EBITDA/EBIT/EBT, LY, CY, LTM, future, underlying, Debt – loans, IDF, customer advances, overpayments, tax, HP, onerous leases. Multiple – publicly traded, recent deals

DEAL SECRETS – Valuation = Art not a Science (a selection)

DEAL SECRETS – Pre-deal Key questions an investor wants to know What's special/ what are you famous for? How do you make money? Why now? Am I buying from the inside? What happens in your business in a recession? Choosing the team Management team Your advisors- Corporate Finance/ Legal

DEAL SECRETS – During the Deal Deal teams CFO & FC CEO Advisor – day to day No surprises Dataroom Financial and commercial due diligence Acquisition DD v VDD Competition – healthy! Financial performance

PRE-DEAL – Choosing your financial partners ( assumes institutional ownership) MBO Team Debt Providers Equity Investors Newco Vendor Loan Agreement Loan Shares Service Agreements Subscription Articles of Association Purchase Consideration Sales and Purchase Agreement Key: Cash Movements Legal Agreements Table 4 – Relationships set up in an MBO

CONCLUSIONS Know what you want! Follow the cash The clock ticks very slowly at certain points on a deal Delays generally means bad news PE final thought….