Francis Ives, the charismatic chairman of Cyril Sweett, has the reputation of being an enterprising fellow.
So, although the firm’s announcement this week that it wanted to list on the alternative investment market was something of a surprise, the fact that Ives chose a completely different approach to his peers is, on closer reflection, true to character (see news). Compare Gardiner & Theobald, for instance, which this week announced that it was restructuring its business, freshening up its image and carrying on as normal.
Cyril Sweett has a colourful corporate history. It sold out to property agent Chesterton in 1994 only for Ives to engineer a buy-back four years later, after it had become clear that it was the deal from hell. Around a fifth of the firm’s shares are now owned by Ives and his chief executive Dean Webster, with the rest split across 500 of the 650 employees, who will therefore need to give their approval for the flotation to go ahead.
But is the move enterprising or foolhardy? Sweett says the aim is to raise money for overseas expansion, and going public is certainly preferable to a white-knuckle ride with a private equity firm. But quite why a merger with a QS in a similar position hasn’t materialised is anyone’s guess. The pressure is on to keep pace with the globalisation of the client base, and competition is intensifying as engineering-based consultancies snap up QSs. Although Cyril Sweett has a strong balance sheet, traditional borrowing presumably wouldn’t have provided enough fuel for the kind of growth it is aiming for. Neither would it provide the pocket money for Francis to invest in a few more E-types.
So, Cyril Sweett is going boldly into the mean streets of the City. But as the handful of consultancies who’ve trodden that path before have found, firms on the stock exchange don’t have the freedom that partnerships enjoy. Being a slave to one’s share price can force companies to try to find short-term solutions to long-term problems, and completing a deal is not always as easy as it seems: it needs more than just wads of cash.
It’s these things staff will need to weigh up before taking the City’s shilling …
Denise Chevin, editor
There’s much to celebrate in the £91m revamp of London’s Royal Festival Hall. Allies and Morrison has cleared out all the clutter of shops and offices so the foyers have regained their sweep. Kierkegaard Associates has improved the auditorium’s notorious sound performance, and ISG InteriorExterior has coped with a lot more asbestos than had been anticipated, yet still completed the work on programme. But this building is no heritage relic from the Festival of Britain. It is more than ever a living, working, vibrant building and London’s prime music venue in the heart of the city. If only the Millennium Dome could have reached such high and enduring aspirations.