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LTD using PAYE vs Umberalla PAYE

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    #41
    Hate to tell you I told you so....

    Originally posted by simonsjdaccountancy
    They actually sold out a month or two back for £7.5m. The funding came from using their own cashflow. All entirely above board, but any downturn in the market, or in their own business could cause a great deal of cashflow problems.
    This is on another contract portal:

    Management buyout time at the biggest PAYE IT Contractor Umbrella company in the UK.

    Parasol Ltd, one of the UK’s fastest growing companies – and one of the country’s leading recruitment services providers – took a huge step forward when it announced plans today for a new management structure that will pave the way for even higher levels of service and business success in the future.

    The company stressed that these meticulously-planned changes will have no effect whatsoever on the service levels enjoyed by the 15,000-plus self-employed professionals and 2,500 recruitment agencies that Parasol works with, emphasizing that the changes are focused on building stronger internal structures from which the organisation can move forward to offer new services and to go to new territories.

    Management Buy Out

    To successfully implement its planned changes, Parasol has entered into a Management Buy-Out, with existing non-executive company shareholders being replaced by a new management team built around existing senior management and expert personnel in specific business roles.

    Current Managing Director and founding partner, Rob Crossland remains as a major shareholder and in operational control of the company.

    They obtained the funding from banks and venture Capital companies that will allow them to move forward.

    Due Diligence

    Before the investment companies would invest and the banks loan the money there was a huge amount of Due Diligence, as you would expect, as the investors wanted to invest in a safe contractor umbrella company who were compliant wit HMRC rules etc. rather than some of the more flaky schemes that HMRC might go after.

    There have been several other attempts by Contractor Umbrella Companies in the past to try and obtain funding from investors but these have come to no avail after the Due Diligence phase.

    It seems that Parasol have been the first to overcome this hurdle which will give them major competitive advantage over many of their rivals.

    PCG

    The Professional Contractors Group took a similar decision when it wanted to choose a safe partner when creating their own umbrella company Quality Umbrella or PCG (QU).

    The last thing the PCG would want would be an umbrella company that ran foul of Government legislation or went bust taking contractor's money with them.

    The PCG are known to be ultra cautious and it is significant that they chose Parasol to partner with them.

    What's the Difference?

    So, what difference will it make to IT Contractors and agencies?

    Rob Crossland, the Managing Director of Parasol said it would be business as usual as far as contractors and agencies were concerned.

    He compared it to when the Football Premiership was set up. There was great jubilation amongst the clubs but the fans couldn't see what the excitement was all about.

    Premiership

    There were the same teams playing that season as there were the season before and most of the players were the same. All that had changed, to them, was the name.

    And indeed they were correct.

    The big changes came gradually and to the benefit of the clubs, players, fans (and agents) alike. The money that got poured into the Premiership allowed the clubs to invest more in better players and facilities, leading to Arsenal getting to the final of the Champions League last year and Liverpool winning it the year before.

    Same for Parasol

    It should be the same with Parasol. They are safe enough to have been selected by the PCG and to have funds obtained from investors and banks where others have failed.

    This will make them an even safer contractor umbrella company whilst giving them the funds to offer more and better services to their customers.

    Dedicated to Service

    With the Management Buy-Out now completed, the company’s 80-strong customer support team remains focused on continuing to deliver its high quality, award-winning professional services to both agencies and contractors.

    Rob Crossland, Managing Director of Parasol commented, “This is an exceptionally exciting time for Parasol Ltd., its staff and its customers – and we have re-structured our business in a way that will allow us to continue to lead the market with innovative products and services. Parasol has become the byword for wholly compliant umbrella solutions and we look forward to further strengthening our position across the recruitment services sector.”

    “The outcome of Parasol’s business change programme will set new benchmarks for the levels of service recruitment agencies and consultants can expect to receive”.

    Comment


      #42
      I've never read quite so much hype!

      The fact is that of the 5 original shareholders, 4 wanted to cash out. The remaining shareholder has therefore had to raise around £20 million, secured by floating charge over the assets of the Company.

      I believe this is a quite ridiculous valuation for a Company making just over £1m according to their last accounts.

      What it does is to put Parasol in a massively vunerable position as they now have debts of £20m to service.

      This cash has not been raised to somehow improve the service or the business, it has been raised to enable to the other shareholders to cash out.

      Any downturn in the market, fall from grace, change in legislation etc could mean the loans would no longer be serviced which would result in liquidation. In these circumstances the contractors who would be owed money would need to stand in the queue behind bank loans of £20m.

      Oh, and they do not have 15,000 clients as the PR suggests - last accounts said somewhere under 3000.








      Originally posted by Xtrain
      This is on another contract portal:

      Management buyout time at the biggest PAYE IT Contractor Umbrella company in the UK.

      Parasol Ltd, one of the UK’s fastest growing companies – and one of the country’s leading recruitment services providers – took a huge step forward when it announced plans today for a new management structure that will pave the way for even higher levels of service and business success in the future.

      The company stressed that these meticulously-planned changes will have no effect whatsoever on the service levels enjoyed by the 15,000-plus self-employed professionals and 2,500 recruitment agencies that Parasol works with, emphasizing that the changes are focused on building stronger internal structures from which the organisation can move forward to offer new services and to go to new territories.

      Management Buy Out

      To successfully implement its planned changes, Parasol has entered into a Management Buy-Out, with existing non-executive company shareholders being replaced by a new management team built around existing senior management and expert personnel in specific business roles.

      Current Managing Director and founding partner, Rob Crossland remains as a major shareholder and in operational control of the company.

      They obtained the funding from banks and venture Capital companies that will allow them to move forward.

      Due Diligence

      Before the investment companies would invest and the banks loan the money there was a huge amount of Due Diligence, as you would expect, as the investors wanted to invest in a safe contractor umbrella company who were compliant wit HMRC rules etc. rather than some of the more flaky schemes that HMRC might go after.

      There have been several other attempts by Contractor Umbrella Companies in the past to try and obtain funding from investors but these have come to no avail after the Due Diligence phase.

      It seems that Parasol have been the first to overcome this hurdle which will give them major competitive advantage over many of their rivals.

      PCG

      The Professional Contractors Group took a similar decision when it wanted to choose a safe partner when creating their own umbrella company Quality Umbrella or PCG (QU).

      The last thing the PCG would want would be an umbrella company that ran foul of Government legislation or went bust taking contractor's money with them.

      The PCG are known to be ultra cautious and it is significant that they chose Parasol to partner with them.

      What's the Difference?

      So, what difference will it make to IT Contractors and agencies?

      Rob Crossland, the Managing Director of Parasol said it would be business as usual as far as contractors and agencies were concerned.

      He compared it to when the Football Premiership was set up. There was great jubilation amongst the clubs but the fans couldn't see what the excitement was all about.

      Premiership

      There were the same teams playing that season as there were the season before and most of the players were the same. All that had changed, to them, was the name.

      And indeed they were correct.

      The big changes came gradually and to the benefit of the clubs, players, fans (and agents) alike. The money that got poured into the Premiership allowed the clubs to invest more in better players and facilities, leading to Arsenal getting to the final of the Champions League last year and Liverpool winning it the year before.

      Same for Parasol

      It should be the same with Parasol. They are safe enough to have been selected by the PCG and to have funds obtained from investors and banks where others have failed.

      This will make them an even safer contractor umbrella company whilst giving them the funds to offer more and better services to their customers.

      Dedicated to Service

      With the Management Buy-Out now completed, the company’s 80-strong customer support team remains focused on continuing to deliver its high quality, award-winning professional services to both agencies and contractors.

      Rob Crossland, Managing Director of Parasol commented, “This is an exceptionally exciting time for Parasol Ltd., its staff and its customers – and we have re-structured our business in a way that will allow us to continue to lead the market with innovative products and services. Parasol has become the byword for wholly compliant umbrella solutions and we look forward to further strengthening our position across the recruitment services sector.”

      “The outcome of Parasol’s business change programme will set new benchmarks for the levels of service recruitment agencies and consultants can expect to receive”.
      P.S. What Spreadsheet? Revolutionising the contracting market again.

      Comment

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