The mission
Build a consensus within the Board and confirm ongoing business strategy.
Streamline and grow the group acquiring businesses in new market areas and selling off those which are no longer aligned with core competence.

The solution
Choose Cambashi as a long term trusted advisor with whom strategic plans can be discussed.
Commission Cambashi to conduct analysis to support plans.

The results
K3 grew turnover from £8m to £20m during 2004.
One business sold off at best price.
New businesses acquired in target markets.
New non-executive director successfully sourced.
Directors' remuneration raised in line with industry norms.

The customer
"Cambashi's people are very, very bright with unparalleled experience in our core industry."
Andy Makeham, CEO, K3 Business Technology Group

K3 Business Technology Group develops and sells a range of scaleable ERP and accounting products. It has become a one-stop shop for internet enabled business and supply chain management solutions for the SME sector.

One of the leading vendors in the UK ERP market, K3 has more than 1,650 customers. These range from corporate blue chip companies to small independent, owner managed workshops. K3's deliberate philosophy is to keep development of the software it sells in the UK. In this way the company can guarantee the best possible service and support to customers.

Listed on the London Stock Exchange, with 1500 shareholders, K3 has to abide by strict regulations regarding due diligence and disclosure. The company was created following a management buyout in 2001 and at that time the board was very conscious of its new responsibilities. Given that there were several non-executive directors who were fresh to the industry it was very important that all options were fully considered and discussed.

"As a new public company we needed a strong strategic direction. We had mapped out what we thought was our future but we wanted to sound out our ideas with a reputable advisor. We were familiar with Cambashi and called Mike Evans" said Andy Makeham, Chief Executive of K3.
Cambashi worked on a peer to peer basis with K3's directors, looking at different scenarios and examining exactly which target markets to pursue. "We had a business plan" commented Andy Makeham "but through our interaction with Cambashi we gained several fresh ideas."

Later, Cambashi helped K3 to sell a business unit which had been identified as non-core. Through industry contacts Cambashi found potential buyers with portfolios where the business had a better fit. It then researched details for the prospectus and advised on valuations.

At the same time, using the criteria developed within the business plan, Cambashi helped K3 to identify which businesses would make an advantageous purchase within target market sectors. Cambashi conducted a commercial appraisal of the best potential target then advised K3's leadership team.

"With Cambashi's help we've been able to reshape our portfolio by buying and selling businesses" said Andy Makeham. "Because Cambashi experts are so familiar with the manufacturing environment they are fully aware of the constraints we operate under. They know our strategy so they come up with the right acquisition possibilities. Cambashi digs around for the most significant statistics on how quickly a sector is growing or how quickly its IT spend is growing. Then we can rely on them to know all the going rates. As a result we are able to negotiate a good deal for customers and for each provider."

K3 is seeking to expand into retail and distribution and it is looking for companies with growth of 5% to 10%. As a public company it has to publish and circulate a prospectus before any acquisition. It also has to share all details with the range of accountants and lawyers who oversee any acquisition.

As Andy Makeham explained "We need to be very careful what to say. We need to accredit any information we provide and substantiate any claims about prospective markets. The research and analysis that Cambashi conducts carries respect in the City. We have used it to corroborate what we say and it helped us to prove our case. Cambashi's role in pulling things together is quite key to our overall strategy. A prospectus is a legal document and cannot contain fraudulent information, I rely on Cambashi for that. If Cambashi did not find statistical support for a proposed move we would be willing to rethink."

When K3 needed a non executive chairman Cambashi was able to provide the names of suitably qualified people who were available. "Cambashi really understands our core industry; in fact has been thoroughly plugged into it for years so we can tap into numerous contacts" observed Andy Makeham.

K3 now turns to Cambashi periodically when it needs to confirm that it is keeping everything in line with agreed strategy and its own rapid growth. For example, Cambashi was asked to review the remuneration of directors and suggest appropriate new packages after turnover tripled from £8m to £25m in 2004.

"Cambashi has very bright people. We see them as strategic, long term advisors who form a deep, credible source."

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