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Marios Chiromerides: Connecting Businesses

Marios Chiromerides: Connecting Businesses

By Effy Pafitis

 

Following the conclusion of its first year of operations in Cyprus, international business transfer agency Connecor Investments has succeeded in connecting business, partnering buyers and sellers alike to transform the transition process of sell-side deals.


Marios Chiromerides, Managing Director of Connecor Investments in Cyprus, talks to Gold News exclusively, discussing both the highlights of the past year and his projections for the next.


January 2015 marks the first anniversary of the launch of Connecor Investments’ Cyprus branch. Local operations have developed significantly during the past year; what can you tell me of this progress?


First of all it’s worth noting that Connecor Investments and its international shareholding Group have gone through an important restructuring exercise in 2014.  We are now part of the Hansa Mercator Group, which is listed on the Dutch Caribbean Security Exchange, with thirteen offices in thirteen strategic countries.  Connecor now has three own offices in Barcelona, Hong Kong and Nicosia, and seven group-affiliated offices in Cape Town, Dubai, London, Montevideo, Mumbai, Mexico City and Shanghai.


Local operations are moving according to plan.  The first year is closing with a significant portfolio of important and interesting, local and international, sell-side clients in hand.  Among these are existing businesses looking for an exit, important real estate hospitality assets, recreation and amusement, technology, new real estate investments and new venture capital projects looking for partners.  All these opportunities are within the business scope of Connecor, i.e. transactions in the small to medium market cap segment, ranging from one million to one hundred million euros in ticket size.  The Cyprus branch is also responsible for opportunities arising from jurisdictions located in the Middle East, the Balkans, Eastern Europe and Russia.


In addition, we have a number of international search engagements, where buy-side clients and investors show specific appetite for acquisitions, and they engage us to search for opportunities within a specific time frame. 


It’s been a good year also in terms of new collaborations.  We have developed an important network of trusted associates and intermediaries, such as lawyers, accountants, corporate consultants, investment managers, financial advisors, estate agents and business brokers, with whom we work together to facilitate transactions.  A number of important discussions are currently in progress, and we expect 2015 to be the year where these introductions will materialize into deals.

What have been the main highlights of the past year?


A number of happenings are worth noting in 2014, the most important one being the servicing of a very important client from the Middle East, who is looking to enter into Cyprus and invest in developments as part of their international expansion plan.  The particular communication is in progress for nearly a year, and we have been asked to search and short list assets according to specific criteria, and to carry out visits and prepare opinion sheets for each opportunity.


The particular investor has made two visits to Cyprus already and has spent enough time with Connecor to investigate all possible options, to understand local operations and our way of doing business, in order to assess how this can be incorporated into their existing structure.  A number of important meetings have been carried out already with identified possible local JV partners or acquisition prospects, in order to be able to proceed to the next stage of negotiation.  Such high caliber corporate clients can indeed make a difference for Cyprus, if they finally decide to invest into our country, and they could indeed help us generate growth in the years to come.  This is why we must ensure that they have enough business incentives to take on such additional country and business risk.  Hopefully this client will materialize in 2015, during their next planned visit.


Client response and feedback has been particularly encouraging since the branch’s establishment. What does this tell you of the prospects of Cyprus’ business environment?


Connecor is a business transfer agency, mediating between buyers and sellers of businesses and assets.  It’s very important that the company is operating in the mid-market cap segment, and that it has international exposure and experience. This is something that Cyprus has been lacking to date and we are here to serve that particular market niche, as transaction brokers and intermediaries.


Personally I am optimistic about the prospects of the Cyprus business environment and I think we have already been through the worst times.  Through our network, we see more interest arising for Cyprus from the Middle East and China, which is extremely encouraging.  Interest is one thing though, actual deal closing is another!


Though M&A activity has been affected by the global financial crisis, it is widely believed that the economic downturn has also created many unique opportunities. Has your experience proven or contradicted this assumption? 


Each investment opportunity has its own merits and there have always been opportunities available, with the crisis indeed creating a lot more now.  Financing for these transactions has been largely available in the past, so it was easier for transaction brokers, intermediaries or capital finders to close a deal.  A buyer was always willing to pay just a little bit more to close the deal, and the bank was more forthcoming in providing financing.  These facts also created a cushion for the seller, making the latter more comfortable in selling.


Unfortunately bank financing is now very limited so most buyers are actually cash buyers.  In a buyers’ market with many options on the table, it is expected that the seller will need to make some additional concessions in order to close a deal.  Those sellers that have not realized this yet, are wasting valuable time that they cannot afford to lose.  An opportunity is indeed an opportunity if a deal materializes.  If it’s seen as an opportunity only in the eyes of the seller, it is not really an opportunity!


Finally, what are Connecor’s priorities for 2015, both internationally and locally? How will you ensure that these goals come to fruition?


After our international restructuring exercise as a Group, we are now looking to grow our operations in both our own, and our group-affiliated offices.  It’s always important to have a good international portfolio of listings, so as to attract serious investors, and thus we are constantly enriching our international portfolio with more interesting offerings.  Our new, interactive and very informative website has around fifty listings at the moment, which are always presented on a “blind profile” format.  A lot more opportunities are of course strictly confidential and are kept in our top drawer, only to be presented to those investors who have passed our screening process.

 

The Cyprus office is working on a three-year business plan.  The first year has been successful in setting the foundations.  The second year is very important in capitalizing on these connections made, and ensuring that sufficient deals materialize for the year, but also in offering our business transfer services, with business valuations, exit strategy planning, preparation of information memorandums etc.  Our external communication will thus be enforced during this year to reach this goal, both with prospective buyers and sellers of businesses, but also with our network of collaborators.  A number of visits will also be carried out to our jurisdictions, in order to meet possible buyers and sellers.

 

About

 

Connecor is a business transfer agency providing expert transaction management to private businesses and companies, during the transition period when the ownership of a business or company changes hands. 

 

Connecor offers services to assist business owners to plan for their exit, and future owners in finding and entering a business; with a special focus on small and medium-sized businesses in Europe, Latin America, Southeast Asia and the Middle East. 

 

The company has developed proven business exit and entry strategies to facilitate the whole process, and helps its clients to define their objectives and to identify the best alternatives based on their goals and targets. Core services include: 1) Planning your business entry / exit strategy, 2) M&A, and Business Brokerage, 3) Promotion of Investment Opportunities, and 4) Specialized Business Transfer Services. 

 

You can visit www.connecor.com for more information.

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