Many executives engaged in M&A believe in creating a long list of acquisition prospects. However, the goal of your M&A process should be to find the right companies. Obviously, it’s good to fill your pipeline with prospects, but you want to be sure these prospects match your strategic criteria. What good is a long list […]

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By John Dearing, Managing Director McKinsey & Company recently published an article on using M&A as a tool to give your company a competitive advantage. The article addresses some key aspects of M&A we find important at Capstone. You should develop your strategy first when approaching M&A and always have a full pipeline of acquisition […]

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Did you know about 97% of acquisitions are small to mid-sized companies? Acquisition is an effective tool that can be used by companies of any size, not just those in the Fortune 500. To see how, watch my interview with Matthew Lesko. When we think of mergers and acquisitions, we often only think of mergers […]

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Acquisitions fail for reasons that range from lack of compelling strategic rationale to inadequate due diligence to conflicting cultures. I think many would say acquisitions fail because too much was paid for them. While overpaying is certainly a reason for failure, I would not say it is the top reason. In my experience, I have […]

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A recent Deloitte survey noted frequent misalignment between CFOs and company directors about the strategic rationale of M&A. The study concludes that CFOs and board members should align their M&A strategy for greater success. Naturally, I’m not surprised by these findings. The likelihood of successful acquisition would increase if all parties shared the same strategy. […]

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Mergers and acquisitions in the oil and gas industry oscillated from a high of $84.8 billion in the first half of 2012 to just $51.5 billion in the first half of 2013. The total deal value for Q2 2013 was $23.6 billion, the lowest since Q3 2009. Expect a new swing given the rumors that […]

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As you go through the M&A process, you may find that advisors are both necessary and helpful to assist you. However, you must maintain your leadership role. I find that particularly toward the end of the acquisition process, executives imagine that they should hand the reins to a more “experienced” professional. This would be unwise. […]

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As an M&A consultant, I’m often asked exactly how we persuade the owners of not-for-sale companies to sell.  My years of experience speaking with owners and facilitating acquisitions makes the process easier, but the real secret is understanding owner psychology. In contacting an owner, you can’t lay out a detailed acquisition plan. The key is […]

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American individuals and corporations are playing it safe, according to  The Wall Street Journal, contributing to a slower employment rebound:  “[After the recession] of the early 1990s, it took 32 months for payrolls to rebound fully. After the even milder recession of 2001, it took four years. Today, nearly four years after the end of […]

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Yesterday, Apple sold $17 billion in debt offering to investors, the largest corporate-bond deal in history. Apple’s first debt-offering in over 20 years is part of its plan to return $100 billion to shareholders by the end of 2015. This plan is a response to pressure put on Apple to use their excess cash hoard […]

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When you think about your company’s growth, ask yourself, “What is our risk tolerance?” The answer is key to formulating your strategy.  You cannot succeed with a plan for growth that pushes too far beyond the level of risk that is acceptable in your company. If you are the sole owner, the level of risk […]

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Recently, there have been some fairly significant transactions, and I want to mention these and tell you what they may mean for corporate executives. The first deal we have is Berkshire Hathaway and 3G Capital acquiring Heinz for $23.2 billion. Really, if you include debt, that transaction looks to be just under a $30 billion […]

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As I’ve stressed  in an earlier post, I recommend including not-for-sale companies in your acquisition search. This will significantly expand your universe of potential acquisition prospects. However, with such a large pool, you must develop criteria through which to filter the prospects in order to narrow your options. The first step in establishing your criteria for prospects […]

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Edelman Financial Group agreed to sell their business for $258 million which is reported to be a 43% premium over their stock price. The interesting thing is the agreement includes a 40 day “go-shop clause” where the company can seek higher bids. I have been talking about these provisions for several years and expect you’ll […]

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Fortis, Inc (TSX: FTS), a Canadian utility company, announced yesterday that it is acquiring CH Energy Group (NYSE: CHG) for $1B in cash plus the assumption of $500K in debt, which is about 10x 2011 EBITDA. CH Energy, which is a public utility headquartered in Poughkeepsie, NY, said this about the benefits of the acquisition: […]

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Wednesday, February 29 at 1:00 PM ET Register NOW! David Braun, CEO of Washington, DC- based external growth consulting firm Capstone, is hosting a webinar to help you understand the market and to help stimulate the growth of your business. There is a unique opportunity in the market to grow your business through M&A. However, […]

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Beer consumption in the US is growing at 1-2% a year according to the National Brewing Association, I know I’m doing my job of contributing to this growth, but apparently many of you are not! In Brazil the growth rate is over 10%!  So no surprise that Kirin is acquiring a stake in Schincariol the […]

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Last week nearly $20 billion of debt was sold in the form of corporate bonds, according to Dealogic, including Google who issued bonds for the first time ever.  So companies continue to have a record amount of cash on their balance sheets, but are also raising MORE cash by issuing low-cost debt.  There are only […]

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It is common for a business owner to comment about how many times they have been approached about selling their business, particularly if it is a successful one. So in the not-for-sale market of M&A, how do you as the buyer break through the noise and competition? Recently we had a client looking for a […]

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I recently had the opportunity to drive over 1,500 miles over a five-day span throughout the southeastern US.  Two things stood out to me during my drive.  One was the number of shuttered motels, empty and fenced-in distribution centers, and vacant storefronts in small towns and strip centers.  All glaring examples of the on-going economic […]

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