Our buy-side clients at Capstone are seeing the same trend that a recent Reuters article reported: “Companies are making moves to divest assets that are not essential to their operations, while stronger firms, nudged on by their boards and shareholders, are looking to grow and position themselves for the recovery.”  This leads to numerous “orphan” non-core product […]

Read More

There is a trend afoot for firms to become more vertically integrated – controlling their supply sources, manufacturing, and distribution channels.  A few recent examples include Oracle acquiring Sun Microsystems to integrate hardware and software and H-P acquiring EDS to capture more consulting and professional services revenue, along with buying 3Com to capture more customers.  […]

Read More

Over and over on this blog, I have strongly advocated external growth to complement organic growth.  Today the largest 500 non-financial American firms have nearly $1 Trillion in cash and short-term investments on their balance sheets.  That’s Trillion with a ‘T’! This represents roughly 9.8% of their assets.  What does that tell me?  Companies are […]

Read More

The M&A statistics for the third quarter of 2009 are in and show the vast majority of the deals getting done are strategic.  The economic crisis and concerns over deal financing continued to significantly hold down the number and value of deals when compared to the same period last year.  Today, a Wall Street Journal […]

Read More

A story in the news last week caught my eye – U.S. antitrust enforcers are planning to revamp merger guidelines.  This isn’t surprising news – there have been expectations for quite awhile that the Obama administration was going to take a closer look at large corporate mergers.  It also won’t affect the vast majority of […]

Read More

Three recent deals are being heralded as “the revival” of the M&A market.  Although the linked article captures some of the larger buy-side deals (for example Disney’s $4 billion purchase of Marvel) that are now beginning to emerge, we here at Capstone are seeing a similar trend in the area of the market where we […]

Read More

PWC released its second quarter report on M&A activity in the industrial products sector.  Two items from the report stood out for me.  First, M&A activity in the second quarter actually rose compared to the first quarter of 2009 (although still down significantly compared to last year).  This could be a sign that some of […]

Read More

On Friday, August 21, 2009, Capstone will be hosting a webinar on maximizing the time and effort put into due diligence in the acquisition process. Due diligence has traditionally been seen as a “check the box”  exercise – you evaluate the strengths and weaknesses of a target, uncover liabilities and understand risk in order to […]

Read More

In another installment of our video series, I discuss what “Synergy” really means.  Synergy is a word that gets bandied around a lot in the world of M&A.  When discussing potential deals, companies often try to justify a mediocre deal by talking about all of the synergies that will result.  Really, though there are only […]

Read More

There was an excellent profile in last weekend’s Wall Street Journal of Cisco Systems and its CEO, John Chambers. Cisco is a company that “gets it”.  In some of the most difficult economic conditions of our lifetime, Cisco is not hiding its head in the sand.  Here is Chambers’ philosophy: Even in this downturn, we […]

Read More

Back in December, I noted (and agreed with) one author’s proclamation that in the current economy, the balance of power in M&A has shifted from sellers to buyers.  The main reason:  With the credit market in a crunch, cash is king, and cash-rich companies hold a distinct advantage. As these survey results show, this trend […]

Read More

At a seminar on the M&A process, I discuss the most common reason that acquisitions fail – and it might not be what you expect: Have you been part of a failed acquisition?  What do you think was the main reason that it didn’t work? Let me know in the comments!

Read More

I wanted to post a quick note about the difference between the valuation of a company and the price that you pay to buy that company.  This distinction came up after a conversation I had the other day with an associate who had difficulty understanding why he was looking at paying a different amount for […]

Read More

Recent news indicates that the federal government will “prop up” the major banks if they continue to falter.  This has some worried that these large financial institutions will be “nationalized”.  The government says that this is not the case: The strong presumption of the Capital Assistance Program is that the banks should remain in private […]

Read More

This Friday, February 20, I will be holding a free webinar on “Finding the Right Markets for Growth” at 1:00 PM ET.   You can register by clicking here. In these tough economic times, market research and selection are vitally important to position yourself for growth now and in the future. Capstone Program Manager Gretchen Johnson […]

Read More

Thorough market research has multiple benefits for the astute M&A operative. It sets you apart from other buyers by arming you with crucial information when approaching prospects.  It also constitutes one of the early steps in the due diligence that is part of any acquisition program. This is a vital consideration. The conventional concept of […]

Read More

When you’re going after an acquisition, you need clear and compelling reasons— not just for your choice of target company but for your choice of market. The only way I know to do that right is to define your criteria in advance. Needless to say, your specific market criteria will be driven by the unique […]

Read More

Before you look for a company to buy, you need to define the market where you will search your target. Why? The fact is that in almost every business situation, growth follows demand.  The reason you pick your market before you choose your prospects is to ensure there is a healthy, stable demand for your […]

Read More

When you’re considering growth through acquisition, it may seem obvious to focus on companies that are actively searching for a buyer. In fact, this is the most common procedure, widely advocated by investment bankers. However, it is an approach that will severely limit your chances of finding the right company. For-sale companies are often “for […]

Read More

You could assume that as an M&A expert I’m in the business of acquisitions. But I prefer to say that I’m in the business of external growth. Sometimes, growth is served by taking other routes than acquisition. One of those can be a simple strategic alliance, which can play a useful role in expanding opportunities […]

Read More