1. Key considerations INTERNATIONAL EXPANSION JAMES FIELDHOUSE (M&A) ED DWAN (TAX) 28 OCTOBER 2014

2. INTRODUCTION 1.Introductions James Fieldhouse (M&A Senior Manager) Ed Dwan (Tax Partner) 2.Why international expansion? 3.Achieving international expansion Organic Acquisition 4.Growth via acquisition Key considerations Agenda

3. INTRODUCTION James Fieldhouse Joined BDO in 2003 Specialised in M&A since 2007 following a background in audit. Advises on Private Equity and debt fund raisings, private company acquisitions & disposals, and accelerated M&A’s across a broad range of industry sectors, including recruitment and payroll services. JAMES FIELDHOUSE M&A Senior Manager t: 07854 278 307 e: james.fieldhouse@bdo.co.uk

4. INTRODUCTION Ed Dwan ED DWAN Tax Partner t: 07801 418 910 e: ed.dwan@bdo.co.uk Ex HRMC inspector BDO Partner since 2008 Specialises in recruitment and payroll sector FCSA accredited auditor Currently advising a number of local recruitment businesses on UK tax compliance matters including overseas expansion

5. WHY INTERNATIONAL EXPANSION? Exploit new territories Access to new geographies and/or markets Part of a defensive strategy? Expand global footprint and/or brand To accelerate influx of candidates Enhance attractiveness to future potential buyers Rationale ENSURE CONSISTENT WITH OVERALL COMPANY STRATEGY AND BUSINESS PLAN

6. ACHIEVING INTERNATIONAL EXPANSION Organic v Acquisition Acquisition Acquire, merge or form a joint venture with an overseas business Organic Set up an office or operation in an overseas territory using existing resources

7. ACHIEVING INTERNATIONAL EXPANSION Organic v Acquisition Organic  Acquisition  1. Speed 2. Culture 3. Cost 4. Geography 5. Size/scale

8. GROWTH VIA ACQUISITION Key considerations Strategy and business plan Size? Type? Geography? Clear acquisition criteria Cash Debt Equity Funding Research Databases Use CF advisors Identifying targets

9. GROWTH VIA ACQUISITION Key considerations (continued) Deal structure/multiples Off market v competitive auction sales process Offer letter Making approaches Financial (including tax) Legal Commercial Due Diligence Timescales including management bandwidth Integration Foreign currency fluctuations Other

10. INTERNATIONAL EXPANSION Tax Considerations – Organic Growth Understand the nature of the assignment, potential length and the role – monitor as circumstances change What are the current circumstances of the assignees Partner with a recognised local firm Ensure UK tax implications covered Establish a clear process that will stand up to Due Diligence scrutiny

11. INTERNATIONAL EXPANSION Tax Considerations – Growth by acquisition Perform tax specific Due Diligence using local country specialists and UK as appropriate Understand the tax regulatory environment of the relevant countries – e.g. what are the penalties for getting it wrong? Is the risk/ reward ratio workable? Once acquired, establish clear processes and protocols to monitor compliance on an ongoing basis (e.g. monthly updates, quarterly status reports)

12. CONCLUSION Key points Do your homework Take counsel and take advice Stick to your plan (or at least don’t stray too far from it!) Do your diligence Continually re-asses performance against plan

13. ANY QUESTIONS JAMES FIELDHOUSE M&A Senior Manager t: 07854 278 307 e: james.fieldhouse@bdo.co.uk ED DWAN Tax Partner t: 07801 418 910 e: ed.dwan@bdo.co.uk