“Keep your pipeline full,” I often tell clients when speaking about their acquisition prospects. By this I mean that in pursuing M&A you should research 75 to 100 companies. That’s a lot of companies and research, which of course you must record in an appropriate manner. How can you keep track of all your data? …
Category: M&A and External Growth
PE Deals Slowly, But Steadily Increase
Last quarter, we predicted there would be a wave of deals in the private equity sector in the coming months. While we may not have seen a “wave” of transactions, deal volume has slowly, but steadily increased in 2013, according to GF Data. While the number of PE deals has not reached a 4Q 2012 …
Merger Madness: Three Tips for Success
In 2013, we saw interesting mergers & acquisitions across multiple industries, ranging from hot tech deals like Yahoo’s $1.1 billion acquisition of Tumblr to the rescue of favorite food brand Twinkies from bankruptcy by Metropolous & Co. and Apollo Global Management. While the potential synergies of the two companies are always laid out, not much is said …
New Healthcare Trend: Private Health Exchanges
Healthcare is a hot industry for both PE and strategic buyers as they navigate new regulatory issues posed by the Affordable Care Act. According to Reuters, healthcare was the second largest industry in the U.S. by deal value for the third quarter of 2013. The New York Times reports the number of private exchanges has …
Resources for Researching Prospects
Once you’ve determined the characteristics of your ideal acquisition prospect, you’re ready to start researching specific companies. You can begin by using secondary research to identify companies and obtain key data. With secondary research we want to leverage the information we find to evaluate whether companies are qualified. We’ve listed a couple of resources below: …
Use Functional Leaders When Identifying Potential Transaction Synergies
Earlier this month, the Association for Corporate Growth hosted a webinar on “Identifying and Achieving Transaction Synergies and Impacts on the Acquisition Price.” One of the takeaways was the gulf between financial and strategic leaders: “We often see a disconnect between the financial modelers of synergies and the strategic & operational planners, particularly in large …
Due Diligence: The Three Buckets of Critical Information
In performing due diligence, I recommend you look not only for risks but also for opportunities. That’s how I approach due diligence for our Capstone clients. As we examine the seller’s operations and books, we place every new discovery in one of three color-coded “buckets:” Red Bucket: Deal Changers. This is information that materially alters …
5 Approaches to Risks Identified Through Due Diligence
During due diligence, you may uncover deal-changing issues, or what I like to call “red bucket items.” Identifying these risks doesn’t necessarily mean you walk away from a deal, but you will need to negotiate new terms with the seller. Among the ways to protect yourself as the buyer when you find major issues: 1. …
Signs You May Be Buying the Wrong Company
Buying the right company is essential, but it is difficult. It may be easier to eliminate the “wrong” companies – prospects with glaring due diligence issues such as theft or lawsuits, or even more subjective issues like a poor cultural fit. However, the decision is not always so black and white. How can you know …
Sharing Successful Acquisitions with the Chief Executives Club
The Chief Executives Club of Rhode Island has invited me to speak at its breakfast meeting on November 7 in Providence, Rhode Island. The club, whose members are senior executives, annually hosts 10 of these meetings, where America’s top business thought leaders and authors share their views on a wide variety of leadership topics. I …
