Regional strategy at work
regional focus
Now that the primary objectives of both our global and regional
strategy have been finalized, we take a look at how plans are already
taking shape in the European offices. Reflecting on develop-
ments in 2000, and discussing targets for 2001, London,
Madrid and Warsaw give us an update. From Ireland, our
Dublin team reveals the thinking behind the new European
Regional Service Centre.
Top sectors
Bright horizon
Spain - focused partners
Meeting the market
What'sNewS Issue 1 January/Februory 2001
McWilliams: 'We have a
specific vision.'
Knowledge-building, integrating and
differentiating - these are key words
buzzing around London's F&A business
these days. Beginning early last year, ma
jor changes in organization, strategy and
focus have taken place to reposition the
branch in a market
where it was losing
ground. 'While some
cliënt businesses, like
commodities, are con
sistent performers, a
radical refocus and re-
thinking has also
taken place in Lon
don,' explains David
McWilliam, deputy
GM. 'This was based
on a specific vision - of
the market today, of
RI today, and of how
RI needs to be posi-
tioned in that marketplace. Energies have
focused on rebuilding the team, taking a
critical look at our cliënt base, and mak
ing specific decisions about where our in-
vestments, as far as time, products and
knowledge, need to go.' In the last six to
eight months for instance, London's main
stream F&A cliënt base has been reduced
by a third, phasing out less-profitable,
non-core and commercial-based relation-
ships.
Within F&A a straight-forward and sim-
ple approach has been adopted based on
six target F&A sub-sectors. These 'spe-
cial-focus' areas were selected based on
business and financial analyses of the
market (and clients) within those sectors.
'Two key factors were at play here,'
explains Ben Davies, London's executive
director and head of F&A.
'Narrowing the field based on
what we do best and investing
where we can compete. Within
the six focus areas, we know
who we want to have relation-
ships with and the associated
product priorities. We've tried to
build a sustainable link between
our product delivery, knowledge-
focus and cliënt base.' The first
priority is to support the knowl-
edge-intensive products such as
M&A and leveraged and acquisi-
tion finance through which gen-
uine differentiation can be
achieved and where market oppor-
tunities are attractive. With a
highly-evolved sector knowledge,
strategie products can be offered
to clients in order to
anticipate changes or
upcoming trends in the mar
ket. 'We are fortunate in Lon
don now,' says Davies, 'we
have strongly performing
product and relationship
teams, and the overall track
record of closed deals and the
pipeline is impressive. The ulti
mate idea is to build further
this integrated origination and
delivery platform - it's key to
our success.'
Davies: 'Building sustain
able links is a top priority.
opportumties
And as it looks today, so far, so good.
London's cliënt business tripled earnings
of the previous year in 2000 thanks to
major deals with top players such as Tate
and Lyle, E.D. F Man, and the recent
Dairy Crest deal (see back page). This
year the cliënt, advisory and acquisition
finance pipelines look very strong again.
'There's so much action in the F&A sector
today,' says McWilliam, 'and we need to
take advantage of that. In the last year
we've come to understand
the market, the organiza
tion and ourselves much
better. The numbers speak
for themselves. But if you
ask me, this is just the
start.'
Since inception in 1995,
RI's branch in Spain has
seen profits. A major
player in the F&A euro
pean market, Spain offers
the Madrid office many
and the team has certainly
reaped the benefits, with 80 to 85% of
earnings generated in F&A. 'From the be
ginning,' explains Carlos Gomez-Arroyo,
Spain's GM, 'RI and its F&A expertise
has been a natural companion to many
corporates here. The hard work we've in-
vested in the last five years is paying off -
it's time to cut the erop.' 2000 has been
indeed quite fruitful, with four M&A
deals closed, an unusually high number of
syndications and acquisitions finance
deals for the market. The Suiza Foods-
Leche Celta acquisition (see WNS
Mar/2000) - the biggest
M&A transaction ever
carried out in the Spanish
dairy market - tops the list
of 2000 milestones. Total
profit for the year
amounts to an impressive
4.2 million euros (before
tax). But even more im-
portantly, the income/ex-
pense ratio is 2.5:1 while
the ROS net added (after
taxes) rose to between 11
and 12%. Success has also
been fuelled by a strong
economy, with the major-
ity of sectors growing at an average 4%.
Gomez-Arroyo: '2000 was
a phenomenat year.'
What's Madrid's secret to success? 'A very
focused team, with clear objectives,'
Gomez-Arroyo explains. 'Not only are we
focused on value-added products, >-
