Final price Belvoir paid for Northwood is revealed as earn-out nets sellers another £4m

The owners and directors of Northwood who sold the business to Belvoir have been paid almost £4m after a successful two-year earn-out.

It means that the total price paid is £12.6m – which is more than £9m down on the maximum price that could potentially have been paid.

Most of the final payment is in cash, with a quarter in shares, enabling former owners Andrew and Gemma Goodson to retain “a stake in the business that they had so successfully built up over the past 23 years”.

It also means that former Northwood boss Eric Walker, recently promoted to managing director of Belvoir, has firmly embedded his stake in the wider business.

Over 1m shares were sold by chairman and founder of Belvoir Mike Goddard to enable the distribution of shares.

Belvoir bought Northwood in June 2016 at a valuation then said to be up to £22m, with some paid upfront – reported at the time to be over £11.5m with the rest payable at the end of the earn-out.

Yesterday, Belvoir CEO Dorian Gonsalves told EYE: “In basic terms, the initial consideration was £8.6m and the final earn-out payment was £4m, giving a total consideration of £12.6m.

“We have always said to our investors that the maximum possible consideration of £22m was optimistic and exceeded our expectations and those of PwC in their financial due diligence.

“The earn-out period gave the sellers the opportunity to maximise the value and, all credit to the Goodsons and the Northwood management team, Northwood EBITDA increased by 51% over the two-year earn-out period.

“Belvoir’s management team helped the Goodsons to achieve this by centralising certain functions and by streamlining the business during the earn-out period.”

Belvoir Lettings yesterday issued this statement to the stock market:

“Belvoir Lettings plc (AIM: BLV), has been notified that on 4 December 2018, Mike Goddard, Chairman of the Company, sold 1,065,431 ordinary shares of 1p each in the Company (“Ordinary Shares”) to the vendors of Northwood at 92.9p each.

“The acquisition of Northwood in June 2016 was subject to a two-year earn-out. During the two years under review, EBITDA performance increased by 51% from £1,069,000 to £1,616,000 against which a final consideration payment of £3,959,000 was due. Settlement of the final payment in either cash or shares was at the discretion of the Board.

“Feedback from institutional investors clearly supported 100% cash settlement, if possible.

“Accordingly, Mike Goddard has made available 1,065,431 shares, enabling the Northwood vendors to take 25% of their collective final cash consideration in shares, thereby retaining a stake in the business that they had so successfully built over the past 23 years.

“As a result, the following transfer of shares from Mike Goddard took place:

Andrew David Goodson733,869555,3391,289,2083.69%Gemma Goodson244,623185,113429,7361.23%William Eric Walker32,60221,71354,3150.16%Philip Allan Gee21,73516,44738,1820.11%Victoria Alexander21,73516,44738,1820.11%Nicholas Mark Harris10,8678,22419,0910.05%

“Both William Eric Walker and Phillip Allan Gee continue to be employed by the Belvoir Group as Group Managing Director and Northwood Managing Director respectively and are regarded as PDMRs.

“Following this transaction Mike Goddard holds 4,506,490 Ordinary Shares, representing approximately 12.9% of total issued share capital and voting rights of the company.

“Furthermore, the option period for options held by Dorian Gonsalves under the Belvoir Lettings PLC Unapproved Share Option Plan over 163,399 shares due to expire on 31 December 2018 has been extended to 31 December 2020.”

https://forums.moneysavingexpert.com/showthread.php?t=769233

Does anyone use Northwood Lettings

Has anyone had any dealings with Northwood Lettings? They are advertising heavily on the radio around here, Milton Keynes/Bedford (although they are all over England) as they do a guaranteed rental income scheme.

I recently signed up for this and have been bitterly disappointed with the reality. I have been mis-informed twice, they put me on the wrong scheme and then blamed my partner getting involved for the problems even though he has never spoken to him!

Just wondering if anyone else has had any good or bad experiences with them?

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Slow and in-efficient in my opinion!

they take your place on for 12 months but they have a get out clause at 9 months if the place is not rented or you refuse to sign a new term - you do not have any get out clause if you need / want out before 12 months you have to pay them.

They don't pay you for 6 weeks and then they pay by BACS so it's 2 to 3 days after you expect the money.

They will take your place on in December but be very careful as they consider something like 19th Dec to 10th Jan non marketable times and so don't pay for them.

I found that the details changed depending on who you spoke to and never did get a straight answer, even in writing, about who paid the bills if the property was empty, it finally worked out to be Northwood. I had only approached them as I wanted a stress free year and could cope with the low monthly rent in return for no hassle - what a idealist view that was!

Glad to be shot of them, only good thing was my place stayed empty the full 6 months they had it (yes I did get out early) so it was in excately the same condition when I got it back.

This business is franchised and so I'm sure it will vary countrywide. The idea is good and if you take your time get answers to your questions in writing (always go direct to the manager) I'm sure it can work - many other agents now do guaranteed schemes so the princple must work.

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At my wits end with these folk.

Tell lies on the phone. Staff are rude. Don't reply to phonecalls. Maintenance is diabolical.

There's no telephone number for head office. Have no idea how a company can get away with being so bad.

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If northwood take the tenancy in their name they can put any tenant in there they like as you'd have no control at all. They could use it for office parties without you knowing at all!

Also, if they pay you a guaranteed rent as HelloKitty08 puts it above (seems to tie in with their website) they can offer you way below market value for a year of peace, get a tenant paying market value to them, take a hefty cut and hence cover the costs of most void periods as well as making a profit.

They are operating heavily in this area with colourful cars, signboards but don't have many 'Let By' boards up.

Most other agents that offer rent guarantees do so via an insurance policy they employ.

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Northwood took 6 weeks to replace a cracked bath after I'd instructed them to proceed, so the tenant was without a bath all this time because it was leaking into the flat below. The quality of workmanship was appalling, they'd cracked the wall tiles, the sealant was a mess, the bath panel didn't fit, they even managed to crack the new bath! Then to cap it all, they re-used the old taps and these later seized up so the water had to be turned off at the mains. It took them a further 7 months to rectify this. Their excuse? Landlords want cheap jobs not quality. I was fumin'. That's why I sacked them.

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