The London Group March networking event takes a look at what's involved in selling or buying a business or raising some equity, with key insights from recent deals. Join us on Wednesday 29th March 2017- 6:30 pm Seats are limited – click to reserve one Program includes: Selling or Buying a Business with Special guest speakers: Peter Kroeger: Mergers and Acquisitions Partner at KLO Partners Mitesh Patel: CEO and Founder of Fifosys Ltd, an IT Managed Services Business and software developer for Engage Whether you want to sell your business tomorrow or one-day, or you are looking to buy a business as part of your growth strategy, or you have a client who wishes to sell their business or acquire a business, or raise equity funding - this will be a fascinating and illuminating event. You will pick up tips to help you figure out where the snakes and ladders are when you are involved in preparing for the sale of a business. … [Read more...]
Acquiring a Business – Issues to consider – Part 4
Before you make the offer to acquire a business – Consider what happens next Post-Acquisition Strategies Prior to making an offer, the acquirer should consider the purpose of the acquisition and re-visit the reasons for making the acquisition and how well the target fits within those reasons. The steps required are: Confirm the acquisition meets the deal objectives Is the business to be run standalone or integrated? Is the culture very different and will this inhibit the deal success? Does the acquisition meet the objectives set out in the overview? Ensure the commercial due diligence checklist is linked to running the business Understand the competitive landscape the acquisition target operates in. Understand the management intentions and how to use the management team being acquired to best advantage. Plan to take advantage of the “halo” effect Identify the areas where the quickest and most profitable extra profit can be obtained and assign people to exploit it Assess the … [Read more...]
Acquiring a Business – Issues to consider – Part 3
WHY DO ACQUISITIONS FAIL AND HOW DO YOU AVOID A BAD OUTCOME? It is an unfortunate fact that Acquisitions have a very high failure rate. This may seem a powerful statement but it is borne out by the statistics. "If one were to define 'failure' as failure to increase shareholder value then statistics show these to be at the higher end of the scale at 83% (Cnnfn.com 1999).” “In 2004, McKinsey calculated that only 23% of acquisitions have a positive return on investment.(http://jurisonline.in/2008/11/failure-mergers/)” The generally accepted view is that over 50% of all acquisitions fail to achieve an increase in shareholder value. I believe that this applies mainly to very large acquisitions and they are the ones that hit the headlines. In my experience, most acquisitions, undertaken with careful planning and due diligence do provide significant value.The main areas to consider are: proper strategic thinking for an acquisition sufficient and well thought-through preparation by … [Read more...]
Acquiring a Business – Issues to consider – Part 2
WHAT SPECIFIC ATTRIBUTES MAKE AN ACQUISITION AN ATTRACTIVE STRATEGY? Acquirers are interested in growing their own businesses and an acquisition is one of the options available to them, and usually provides a faster track to growth than organic growth. In addition, they can be interested in other benefits, for example: geographic expansion customer base customer spread, i.e. for a retail business a large number of customers, for a manufacturer a number of blue-chip customers, such that there is no undue reliance on a small number of customers contract durations repeat business patterns skill-sets technology Intellectual Property Rights depth and quality of management uniqueness and competitiveness of products and services scalability of products and/or services market position and brand systems and processes, particularly relating to winning new business distribution quality of service the “halo” effect, the extra revenues and profits that can be gained from e.g. … [Read more...]
Acquiring a Business – Issues to consider – Part 1
WHAT IS THE MAIN STRATEGIC REASONING FOR ACQUIRERS OF A BUSINESS? Acquirers do not buy the past performance of business. They buy the future performance of the business, but use the past performance as a guide (along with other things) to establish the likelihood of the future profits. Acquirers can have diverse motivations: ego or status a carefully thought out strategy opportunistic reasons, e.g. see a competitor of failing business up for sale and think a good deal may be had by acquiring it a Seller (or the Seller’s Advisor) has managed to paint a vision for the Acquirer of what the end result will look like of the two businesses once they have been merged. The case will appear convincing, such that the Acquirer will believe that, by acquiring, he or she will be able to generate a value significantly greater and faster than the alternative of continuing organic growth. Whatever the starting point, once an Acquirer is “in play” and considering an acquisition, then it is the … [Read more...]
