Considering an acquisition?
We do what no other company does for investor or buyers.
The track record of M&A by any number of sources reveals a failure rate of greater than 70-80%. And the number one reason for failure is paying too much. (The second reason is clashes of culture – management and decision making processes. We can help with that too.)
How to de-risk the acquisition your deal team is advocating? By getting an outside third party assessment of the potential targets. Ahead of the LOI. Before you spend a lot of time, resources and money on your deal team and due diligence.
The reality is, most company owners and shareholders have an inflated sense of value of the company and what it is really worth. Which is why most middle market companies fail to sell at enterprise value and are forced into a sale of assets.
Our proprietary Invest-Ability Index™ will identify the drivers of Strategic Premium that temper what a valuation price will tell us by inserting a deal time realism that can be used as a wake-up with the target.
If you choose to go forward with an LOI, it will help de-risk the recommendation from your deal team and provide them with initial areas to investigate during due diligence, speeding up their process. And because the Invest-Ability Index™ uses the Delphi technique for inquiry, it provides a balanced insight into the potential value of the acquisition.
The other reality is that buyers tend to under estimate what is required to optimize the acquisition target’s value ahead of the deal. The will provide a valuable ‘heads up’ assessment to the management team to ensure they have sufficient resources and management bandwidth. You only need to read the Wall Street Journal a short time to see a plethora of examples of failures in this area.
The result of using the Invest-Ability Index™? Greater confidence for the management and board in the success of the deal team’s acquisition.
By the way, we are the only ones a board or management team may use who are not advocates for an acquisition. Other outside members of the deal team only get paid when a deal is done. Whether it gets done or not does not influence what we do, which is to deliver metrics that can be acted on. We are not ‘deal guys’, we are strategy guys.