Roadmap to Acquisitions℠
Sometimes the fastest way to grow your company is to buy another one. Capstone is a leader in middle market mergers and acquisitions.
Your company probably has a process for hiring new employees. It spells out all the steps for recruiting, vetting, interviewing, selecting and onboarding new people.
But, do you have a process for acquisitions? When it’s time to consider external growth, the right acquisition can be the fastest route to expanding market reach, adding new technologies, acquiring top talent and gaining competitive advantage.
Acquisitions can be complex, costly and difficult to reverse. That is why without a detailed process, many needlessly fail. Capstone has a detailed process for acquisition based on a broad range of successful transactions.
It’s a process that has been used and refined since 1995, recognizing that all successful acquisitions require three things: a clear objective, a proven process and skilled execution.
Benefit from our experience. Adopt the Capstone Roadmap to Acquisitions℠.
Phase I: Build the Foundation
Take your bearings, conduct a reality check on your current business situation, and establish a viable strategy for growth.
Know your CORE competency. Consider your business culture and how to share risk tolerance with a potential acquisition.
DEFINE your growth strategy. Consider acquisitions in the context of your strategic growth plan.
Have ONE reason to purchase a company. More than one reason leads to unclear decision making.
Acquisition is a COLLABORATIVE effort. Build a multi-functional Team from the ranks of your company and outside experts.
DEFINE the market in which you will conduct research and ensure a stable demand for products and services.
Phase II: Build the Relationship
Research prospective partners, make initial overtures, and develop a dialogue of trust. Every company is for sale.
Conduct company searches using a STRUCTURED process and OBJECTIVE tools. Integration planning begins now.
Now arrives a critical moment in the ROADMAP process. It is time for your Team to apply their exhaustive planning and research.
Building TRUST between the buyer and seller and early face-to-face meetings are critical, as well as, rich in opportunities and insights.
Determine the strategic fit and ONE reason objective of the prospect and calculate the company's financial worth.
Stay FOCUSED on your desired strategic outcome while considering the seller's corporate and personal priorities.
Phase III: Build the Deal
Compile the nitty-gritty of due diligence, deal structure, closing the transaction and integrating the entities.
ESTABLISH the non-binding elements of the acquisition and provide a pre-LOI to address any miscommunications or misunderstandings.
This should CONFIRM your research rather than inform, and CONFIRM your criteria-driven image of the prospective company for purchase.
ESTABLISHES in a written document the Legal Structure, Financials and other important issues to support the purchase of the company.
EXECUTION of the elements of integration will reflect your strategic choice to plan for and purchase the right company.