m&a presentation by george christadoulo
TRANSCRIPT
August, 2015
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An Overview
} What is today’s marketplace? } What are valuation trends? } Deal Structure } What are the steps? } Do’s and Don’ts! } How do you measure success?
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} Vibrant, robust } Lots of Buyers and Sellers } Seller Motivations ◦ Ownership Transition/Leadership Succession FAILURE ◦ Fund growth, geographic expansion, service
offerings ◦ Unsolicited Offer
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} Buyer Motivations ◦ Geographic Expansion ◦ Expand Services ◦ Public Company growth in earnings ◦ Diversification
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} Creeping upward ◦ Multiple of EBITDA, as adjusted – WHICH EBITDA? ◦ Questions of sustainability ◦ How do Buyers protect against drop off in EBITDA,
Sellers who leave? ◦ Earnouts, Liquidated Damages.
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} Asset Purchase vs. Stock Purchase } Payment of Purchase Price ◦ 50% in cash ◦ 50% in 3-4 year note
} Deliverables by Seller ◦ Target Book Value/Working Capital ◦ Collection of Target Deliverable
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} Employment Agreements } Clawback Purchase Price if Sellers leave early } NonCompetition Agreements ◦ How long?
} Indemnification } Prior Acts Insurance } Buyer’s Stock
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} Determine Motivation/Goals } Assemble Internal/External Team } Search for Partner } Key Discussion Points
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} Preliminary Due Diligence } Letter of Intent } Due Diligence } Transaction Documents } Employment Agreements
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} Closing } Integration
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} Use Intermediaries and Advisors } Seek Compatible Culture } Address Issues ◦ Unproductive principals ◦ Unproductive offices ◦ Percentage Completion of Contracts ◦ Software Licenses ◦ Due Diligence findings
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} Buyer motivation } Seller motivation } Measurement Points
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George E. Christodoulo, PC Lawson & Weitzen, LLP 88 Black Falcon Avenue
Boston, MA 02210 617-439-4990 617-439-3987