Company sale of one of the UK’s largest medico-legal businesses

BUSINESS OVERVIEW

ERG is one of the UK’s largest medico-legal businesses, representing circa 45,000 cases per annum, approximately 7% of the market. It provides independent medical evidence, rehabilitation and treatment support services for insurance and legal professionals.

OUR ROLE

Orbis’s original remit was to assist in re-banking the business away from the existing asset-based lender who was reducing its facilities because it had run out of money itself. ERG was therefore left with insufficient funding despite having restructured its cost base, successfully grown its turnover and was generating healthy profits. It soon became apparent that the chance of achieving this was very remote primarily because of the considerable termination fees that the existing lender would charge, the nature of the debtor book and the banking environment that existed at the time.

We then worked with the management team to select the best purchaser for the business to deliver the highest returns to the loan note holders and with certainty of deliverability. It was crucial that the correct buyer was chosen because of the sensitivity around the c. 7,000 live cases that were in progress at that point in time. If these were mishandled the collectability of the debtor book would have been hugely reduced because of the potential for substantial counter claims.

The business was sold to Premier Medical through a pre-packed administration that saved all the work force and generated over £13m of returns to funders and loan note holders.