SlideShare une entreprise Scribd logo
1  sur  2
Télécharger pour lire hors ligne
Mapping the M&A Journey...
                                               Tom Marx and Paul Cooperstein

Before leaving on a journey it's always useful to have a map to navigate your way from where you are to
where you want to go. As part of our series of white papers, Marx Group Advisors has identified the four
basic types of transfer of ownership transactions. This version is the synopsis of the article that is
available FREE to our readers. Email Tom Marx (tmarx@marxgroupadvisors.com) for access to a PDF of
the entire article. We trust this helps you embark on this journey with greater confidence.

     1.   Mergers and acquisitions
     2.   Divestitures and asset sales
     3.   Joint ventures and alliances
     4.   Going public or private

Mergers and Acquisitions
Mergers and acquisitions are the most common forms of these transactions.
Typically a merger is a combination of two companies in a stock exchange transaction, i.e. Company A
sells all of its corporate stock to Company B in exchange for cash, stock or some combination of both.

An acquisition is the purchase of the stock or assets of the business. A merger and acquisition are not
mutually exclusive. However a merger is typically thought of in the context of two companies that are of
relatively equal size and an acquisition is thought of when a smaller target is purchased by a larger
acquirer.

Quite a bit of research has taken place regarding the reasons why mergers and acquisitions succeed or
fail. Profitability is obviously a factor in every analysis. Some studies have argued that more profitable
firms are more subject to takeover than less profitable companies while others have argued that
profitability has less to do with the likelihood of becoming an acquisition target. Corporations that are
relatively inefficient will be targets of acquisition for more experienced and intelligent acquirers, as well as
acquirers that are looking to purchase companies at a highly discounted rate.

There are a number of factors why certain companies are acquired and others are not.

          Some companies acquire companies that are more profitable than they are, some equally as
          profitable and some less profitable.
          Some acquiring companies look for target companies that are inefficient and therefore offer the
          opportunity for significant improvements in efficiency and profitability.
          Shifts in the capital markets are a significant factor to consider in this process, i.e., in periods of
          high interest rates or when capital accumulation is difficult.
          Changes in tax laws like the Tax Reform Act of 1986 can facilitate or inhibit restructuring activity.




2175 E Francisco Blvd. Suite F, San Rafael, CA 94901 • Tel 415-453-0844 • Fax 415-451-0166 • info@themarxgrp.com • www.marxgroupadvisors.com
It should be noted that in today's marketplace, cross-border mergers and acquisitions are occurring with
more frequency because they often provide an opportunity to capitalize on internal advantages in foreign
markets including financial, organizational and technological strengths.

Divestitures and Asset Sales
Typically divestitures and asset sales are seen as an approach to corporate restructuring that eliminates
underperforming assets while capitalizing on the value of a stronger performing asset or simply exiting
from a business to repay debt and, in either case, create value.

The divestiture process generally includes three approaches to selling the company: the negotiated sale,
the controlled competitive sale and the auction. Each of these approaches has different competitive
landscapes. Valuations of companies or assets in a divestiture need to undergo the same analysis as a
valuation of the company in a merger or acquisition.

The most common transaction is the asset sale of a business. This has benefits over other forms of
divestitures, most significantly the ability to negotiate with multiple parties in order to obtain maximum
value.

As in all steps of the M&A process, tailoring the process to the unique needs of the client and an
intelligent understanding of the marketplace insures a more intelligent chance of success.

Joint Ventures and Alliances
A joint venture is a relationship between two or more parties where an independent entity is created by
the parties for a specific activity or undertaking. The independent entity is usually jointly owned by the
parties and the parties each take an active role in contributing either intellectual property, capital, assets,
marketing and sales or any combination of the above.

An alliance may not involve the creation of a new independent entity and may not involve any equity
contributions by either party.

In a time when success in business requires forming relationships between competitors in ways that were
unheard of years ago, alliances and joint ventures have become quite commonplace and it's clear that
profitability is often created in the formation and operation of joint ventures and alliances which can, in
fact, surpass those found in mergers and acquisitions.

Going Public or Private Transactions
Occasionally we are asked about a going private or going public transaction. A going private transaction
is the acquisition of the equity of a publicly traded corporation by an independent privately held entity.

In the context of the aftermarket it is usually in the form of a leveraged buyout in which a group of
managers (usually with equity partners) acquires an existing business that is publicly owned or a division
of the same.

We are also occasionally asked to consider the benefits of going public. Either the potential size of the
existing company or a rollup of a number of companies with potential to show market rate returns
provides an opportunity to consider the benefits of public ownership.

Conclusion
The underlying assumption in any of the categories or merger and acquisition is that there will be
benefits that occur as a result of the transaction. Consolidations continue to recontextualize many
industries and have significant impact on the entire supplier and customer chain in a vertical industry.

We believe that profitability has far less impact on the ultimate value of the transaction. Instead, strategic
advantage becomes more key, whether it allows the elimination of a competitor, gains a valued customer
or adds an important product line.




2175 E Francisco Blvd. Suite F, San Rafael, CA 94901 • Tel 415-453-0844 • Fax 415-451-0166 • info@themarxgrp.com • www.marxgroupadvisors.com

Contenu connexe

Tendances

China 2015 -- China's Shifting Landscape
China 2015 -- China's Shifting LandscapeChina 2015 -- China's Shifting Landscape
China 2015 -- China's Shifting Landscape
Peter Fuhrman
 
Exit strategies (1)final
Exit strategies (1)finalExit strategies (1)final
Exit strategies (1)final
Iman Ibrahim
 
M Boss Advisors, Llc
M Boss Advisors, LlcM Boss Advisors, Llc
M Boss Advisors, Llc
Wendell Hall
 
Smart Capital Private SecuritiesExchange
Smart Capital Private SecuritiesExchangeSmart Capital Private SecuritiesExchange
Smart Capital Private SecuritiesExchange
craig_4
 

Tendances (18)

China 2015 -- China's Shifting Landscape
China 2015 -- China's Shifting LandscapeChina 2015 -- China's Shifting Landscape
China 2015 -- China's Shifting Landscape
 
Fairness Considerations in Going Private Transactions
Fairness Considerations in Going Private TransactionsFairness Considerations in Going Private Transactions
Fairness Considerations in Going Private Transactions
 
Oiv presentation jeff k davis (mercer capital) 15-11-30
Oiv presentation   jeff k davis (mercer capital) 15-11-30Oiv presentation   jeff k davis (mercer capital) 15-11-30
Oiv presentation jeff k davis (mercer capital) 15-11-30
 
Take Aways from Family Business Alliance's Event on Mergers and Acquisitions
Take Aways from Family Business Alliance's Event on Mergers and AcquisitionsTake Aways from Family Business Alliance's Event on Mergers and Acquisitions
Take Aways from Family Business Alliance's Event on Mergers and Acquisitions
 
IPO vs APO
IPO vs APOIPO vs APO
IPO vs APO
 
Ii B Equity Markets Iiit
Ii   B Equity Markets IiitIi   B Equity Markets Iiit
Ii B Equity Markets Iiit
 
Fairness Considerations in Going Private Transactions
Fairness Considerations in Going Private TransactionsFairness Considerations in Going Private Transactions
Fairness Considerations in Going Private Transactions
 
What entrepreneurs need to know about term sheets
What entrepreneurs need to know about term sheetsWhat entrepreneurs need to know about term sheets
What entrepreneurs need to know about term sheets
 
Man exploits man
Man exploits manMan exploits man
Man exploits man
 
Group Six M&A
Group Six M&AGroup Six M&A
Group Six M&A
 
Presentation linkedin
Presentation linkedinPresentation linkedin
Presentation linkedin
 
Organizing and Implementing an M&A Growth Strategy for Success: Optimizing fo...
Organizing and Implementing an M&A Growth Strategy for Success: Optimizing fo...Organizing and Implementing an M&A Growth Strategy for Success: Optimizing fo...
Organizing and Implementing an M&A Growth Strategy for Success: Optimizing fo...
 
Case study selling_neiman_marcus
Case study selling_neiman_marcusCase study selling_neiman_marcus
Case study selling_neiman_marcus
 
Exit strategies (1)final
Exit strategies (1)finalExit strategies (1)final
Exit strategies (1)final
 
M Boss Advisors, Llc
M Boss Advisors, LlcM Boss Advisors, Llc
M Boss Advisors, Llc
 
Avoiding Hostile Takeovers
Avoiding Hostile TakeoversAvoiding Hostile Takeovers
Avoiding Hostile Takeovers
 
Risk intelligence: How to reliably mitigate transaction risk and secure clean...
Risk intelligence: How to reliably mitigate transaction risk and secure clean...Risk intelligence: How to reliably mitigate transaction risk and secure clean...
Risk intelligence: How to reliably mitigate transaction risk and secure clean...
 
Smart Capital Private SecuritiesExchange
Smart Capital Private SecuritiesExchangeSmart Capital Private SecuritiesExchange
Smart Capital Private SecuritiesExchange
 

Similaire à Mapping The M&A Journey

New microsoft word document
New microsoft word documentNew microsoft word document
New microsoft word document
Divya2603
 
31st Oct Complete
31st Oct Complete31st Oct Complete
31st Oct Complete
ukabuka
 
Business Strategy Review - A better way to merge companies
Business Strategy Review - A better way to merge companiesBusiness Strategy Review - A better way to merge companies
Business Strategy Review - A better way to merge companies
Richard Parry
 
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docx
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docxBUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docx
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docx
curwenmichaela
 
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #
VannaSchrader3
 
18 mergers and_acqiusition (1)
18 mergers and_acqiusition (1)18 mergers and_acqiusition (1)
18 mergers and_acqiusition (1)
Guruprasad HV
 

Similaire à Mapping The M&A Journey (20)

certified merger and acquisitions analyst sample-material
certified merger and acquisitions analyst sample-materialcertified merger and acquisitions analyst sample-material
certified merger and acquisitions analyst sample-material
 
Macr strategy
Macr strategyMacr strategy
Macr strategy
 
M&a transactions
M&a transactionsM&a transactions
M&a transactions
 
Mergers and Acquisitions and it's detailed information
Mergers and Acquisitions and it's detailed informationMergers and Acquisitions and it's detailed information
Mergers and Acquisitions and it's detailed information
 
Mergers and Acquisitions and it's indepth knowledge
Mergers and Acquisitions and it's indepth knowledgeMergers and Acquisitions and it's indepth knowledge
Mergers and Acquisitions and it's indepth knowledge
 
New microsoft word document
New microsoft word documentNew microsoft word document
New microsoft word document
 
31st Oct Complete
31st Oct Complete31st Oct Complete
31st Oct Complete
 
Tata corus project
Tata corus projectTata corus project
Tata corus project
 
Mergers and acquisitions by calvella
Mergers and acquisitions by calvellaMergers and acquisitions by calvella
Mergers and acquisitions by calvella
 
Merger & acquisition with case study
Merger & acquisition with case studyMerger & acquisition with case study
Merger & acquisition with case study
 
Business Strategy Review - A better way to merge companies
Business Strategy Review - A better way to merge companiesBusiness Strategy Review - A better way to merge companies
Business Strategy Review - A better way to merge companies
 
Mergers and acquisitions
Mergers and acquisitionsMergers and acquisitions
Mergers and acquisitions
 
Mergers and acquisitions
Mergers and acquisitionsMergers and acquisitions
Mergers and acquisitions
 
Viewcontent
ViewcontentViewcontent
Viewcontent
 
Mergers And Acquisitions
Mergers And AcquisitionsMergers And Acquisitions
Mergers And Acquisitions
 
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docx
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docxBUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docx
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #.docx
 
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #
BUS 499, Week 6 Acquisition and Restructuring StrategiesSlide #
 
Introduction of merger and acquisition
Introduction of merger and acquisitionIntroduction of merger and acquisition
Introduction of merger and acquisition
 
A note on Mergers & Acquisitions.pdf
A note on Mergers & Acquisitions.pdfA note on Mergers & Acquisitions.pdf
A note on Mergers & Acquisitions.pdf
 
18 mergers and_acqiusition (1)
18 mergers and_acqiusition (1)18 mergers and_acqiusition (1)
18 mergers and_acqiusition (1)
 

Plus de The Marx Group

NTDA 2012: The Art of Buying & Selling a Small Business
NTDA 2012: The Art of Buying & Selling a Small BusinessNTDA 2012: The Art of Buying & Selling a Small Business
NTDA 2012: The Art of Buying & Selling a Small Business
The Marx Group
 
The marxgroup powerbranding _sema2012
The marxgroup powerbranding _sema2012The marxgroup powerbranding _sema2012
The marxgroup powerbranding _sema2012
The Marx Group
 
Sema sales and-marketing
Sema sales and-marketingSema sales and-marketing
Sema sales and-marketing
The Marx Group
 
The marxgroup tradeshow_leverage_pdf
The marxgroup tradeshow_leverage_pdfThe marxgroup tradeshow_leverage_pdf
The marxgroup tradeshow_leverage_pdf
The Marx Group
 
The good bad_and_ugly ppt_final
The good bad_and_ugly ppt_finalThe good bad_and_ugly ppt_final
The good bad_and_ugly ppt_final
The Marx Group
 
Catalyst: Putting the Pow! in Power Branding: The Sequel
Catalyst: Putting the Pow! in Power Branding:  The SequelCatalyst: Putting the Pow! in Power Branding:  The Sequel
Catalyst: Putting the Pow! in Power Branding: The Sequel
The Marx Group
 
Content is King in a Web Marketing Strategy for Top Line Growth
Content is King in a Web Marketing Strategy for Top Line GrowthContent is King in a Web Marketing Strategy for Top Line Growth
Content is King in a Web Marketing Strategy for Top Line Growth
The Marx Group
 

Plus de The Marx Group (20)

Marketing Metrics That Matter - PRI
Marketing Metrics That Matter - PRIMarketing Metrics That Matter - PRI
Marketing Metrics That Matter - PRI
 
NTDA 2012: The Art of Buying & Selling a Small Business
NTDA 2012: The Art of Buying & Selling a Small BusinessNTDA 2012: The Art of Buying & Selling a Small Business
NTDA 2012: The Art of Buying & Selling a Small Business
 
The marxgroup powerbranding _sema2012
The marxgroup powerbranding _sema2012The marxgroup powerbranding _sema2012
The marxgroup powerbranding _sema2012
 
Sema sales and-marketing
Sema sales and-marketingSema sales and-marketing
Sema sales and-marketing
 
The marxgroup tradeshow_leverage_pdf
The marxgroup tradeshow_leverage_pdfThe marxgroup tradeshow_leverage_pdf
The marxgroup tradeshow_leverage_pdf
 
Marketing mythbusting themarxgroup
Marketing mythbusting themarxgroupMarketing mythbusting themarxgroup
Marketing mythbusting themarxgroup
 
The good bad_and_ugly ppt_final
The good bad_and_ugly ppt_finalThe good bad_and_ugly ppt_final
The good bad_and_ugly ppt_final
 
Catalyst: Putting the Pow! in Power Branding: The Sequel
Catalyst: Putting the Pow! in Power Branding:  The SequelCatalyst: Putting the Pow! in Power Branding:  The Sequel
Catalyst: Putting the Pow! in Power Branding: The Sequel
 
Catalyst: Putting the POW! in Power Branding
Catalyst: Putting the POW! in Power BrandingCatalyst: Putting the POW! in Power Branding
Catalyst: Putting the POW! in Power Branding
 
The Marx Group- Green Marketing- APRA 2011
The Marx Group- Green Marketing- APRA 2011 The Marx Group- Green Marketing- APRA 2011
The Marx Group- Green Marketing- APRA 2011
 
The Marx Group - Marketing Synergy Seminar SEMA 2011
The Marx Group - Marketing Synergy Seminar SEMA 2011 The Marx Group - Marketing Synergy Seminar SEMA 2011
The Marx Group - Marketing Synergy Seminar SEMA 2011
 
Content is King in a Web Marketing Strategy for Top Line Growth
Content is King in a Web Marketing Strategy for Top Line GrowthContent is King in a Web Marketing Strategy for Top Line Growth
Content is King in a Web Marketing Strategy for Top Line Growth
 
Relax And Enjoy The Spotlight
Relax And Enjoy The SpotlightRelax And Enjoy The Spotlight
Relax And Enjoy The Spotlight
 
Produce the Perfect Product Launch
Produce the Perfect Product LaunchProduce the Perfect Product Launch
Produce the Perfect Product Launch
 
Stand Out from the Crowd - Defining Your Company’s Value Proposition
Stand Out from the Crowd - Defining Your Company’s Value Proposition Stand Out from the Crowd - Defining Your Company’s Value Proposition
Stand Out from the Crowd - Defining Your Company’s Value Proposition
 
Cost effective.web
Cost effective.webCost effective.web
Cost effective.web
 
Green marketing
Green marketingGreen marketing
Green marketing
 
Trade Show Strategy – Don’t Leave Town Without It!
Trade Show Strategy – Don’t Leave Town Without It!Trade Show Strategy – Don’t Leave Town Without It!
Trade Show Strategy – Don’t Leave Town Without It!
 
Comarketing
ComarketingComarketing
Comarketing
 
Relax And Enjoy The Spotlight
Relax And Enjoy The SpotlightRelax And Enjoy The Spotlight
Relax And Enjoy The Spotlight
 

Dernier

VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
dipikadinghjn ( Why You Choose Us? ) Escorts
 
( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...
( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...
( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...
dipikadinghjn ( Why You Choose Us? ) Escorts
 
VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...
VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...
VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...
dipikadinghjn ( Why You Choose Us? ) Escorts
 
VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...
VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...
VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...
dipikadinghjn ( Why You Choose Us? ) Escorts
 
call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️
call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️
call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️
9953056974 Low Rate Call Girls In Saket, Delhi NCR
 
CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...
CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...
CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...
priyasharma62062
 
VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...
VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...
VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...
dipikadinghjn ( Why You Choose Us? ) Escorts
 

Dernier (20)

Pension dashboards forum 1 May 2024 (1).pdf
Pension dashboards forum 1 May 2024 (1).pdfPension dashboards forum 1 May 2024 (1).pdf
Pension dashboards forum 1 May 2024 (1).pdf
 
VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
 
W.D. Gann Theory Complete Information.pdf
W.D. Gann Theory Complete Information.pdfW.D. Gann Theory Complete Information.pdf
W.D. Gann Theory Complete Information.pdf
 
20240419-SMC-submission-Annual-Superannuation-Performance-Test-–-design-optio...
20240419-SMC-submission-Annual-Superannuation-Performance-Test-–-design-optio...20240419-SMC-submission-Annual-Superannuation-Performance-Test-–-design-optio...
20240419-SMC-submission-Annual-Superannuation-Performance-Test-–-design-optio...
 
Kopar Khairane Russian Call Girls Number-9833754194-Navi Mumbai Fantastic Unl...
Kopar Khairane Russian Call Girls Number-9833754194-Navi Mumbai Fantastic Unl...Kopar Khairane Russian Call Girls Number-9833754194-Navi Mumbai Fantastic Unl...
Kopar Khairane Russian Call Girls Number-9833754194-Navi Mumbai Fantastic Unl...
 
( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...
( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...
( Jasmin ) Top VIP Escorts Service Dindigul 💧 7737669865 💧 by Dindigul Call G...
 
Vasai-Virar High Profile Model Call Girls📞9833754194-Nalasopara Satisfy Call ...
Vasai-Virar High Profile Model Call Girls📞9833754194-Nalasopara Satisfy Call ...Vasai-Virar High Profile Model Call Girls📞9833754194-Nalasopara Satisfy Call ...
Vasai-Virar High Profile Model Call Girls📞9833754194-Nalasopara Satisfy Call ...
 
8377087607, Door Step Call Girls In Kalkaji (Locanto) 24/7 Available
8377087607, Door Step Call Girls In Kalkaji (Locanto) 24/7 Available8377087607, Door Step Call Girls In Kalkaji (Locanto) 24/7 Available
8377087607, Door Step Call Girls In Kalkaji (Locanto) 24/7 Available
 
Navi Mumbai Cooperetive Housewife Call Girls-9833754194-Natural Panvel Enjoye...
Navi Mumbai Cooperetive Housewife Call Girls-9833754194-Natural Panvel Enjoye...Navi Mumbai Cooperetive Housewife Call Girls-9833754194-Natural Panvel Enjoye...
Navi Mumbai Cooperetive Housewife Call Girls-9833754194-Natural Panvel Enjoye...
 
(Sexy Sheela) Call Girl Mumbai Call Now 👉9920725232👈 Mumbai Escorts 24x7
(Sexy Sheela) Call Girl Mumbai Call Now 👉9920725232👈 Mumbai Escorts 24x7(Sexy Sheela) Call Girl Mumbai Call Now 👉9920725232👈 Mumbai Escorts 24x7
(Sexy Sheela) Call Girl Mumbai Call Now 👉9920725232👈 Mumbai Escorts 24x7
 
VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...
VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...
VIP Call Girl in Mumbai Central 💧 9920725232 ( Call Me ) Get A New Crush Ever...
 
Technology industry / Finnish economic outlook
Technology industry / Finnish economic outlookTechnology industry / Finnish economic outlook
Technology industry / Finnish economic outlook
 
Mira Road Memorable Call Grls Number-9833754194-Bhayandar Speciallty Call Gir...
Mira Road Memorable Call Grls Number-9833754194-Bhayandar Speciallty Call Gir...Mira Road Memorable Call Grls Number-9833754194-Bhayandar Speciallty Call Gir...
Mira Road Memorable Call Grls Number-9833754194-Bhayandar Speciallty Call Gir...
 
Q1 2024 Conference Call Presentation vF.pdf
Q1 2024 Conference Call Presentation vF.pdfQ1 2024 Conference Call Presentation vF.pdf
Q1 2024 Conference Call Presentation vF.pdf
 
VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...
VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...
VIP Call Girl in Mumbai 💧 9920725232 ( Call Me ) Get A New Crush Everyday Wit...
 
Lion One Corporate Presentation May 2024
Lion One Corporate Presentation May 2024Lion One Corporate Presentation May 2024
Lion One Corporate Presentation May 2024
 
call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️
call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️
call girls in Sant Nagar (DELHI) 🔝 >༒9953056974 🔝 genuine Escort Service 🔝✔️✔️
 
cost-volume-profit analysis.ppt(managerial accounting).pptx
cost-volume-profit analysis.ppt(managerial accounting).pptxcost-volume-profit analysis.ppt(managerial accounting).pptx
cost-volume-profit analysis.ppt(managerial accounting).pptx
 
CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...
CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...
CBD Belapur Expensive Housewife Call Girls Number-📞📞9833754194 No 1 Vipp HIgh...
 
VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...
VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...
VIP Independent Call Girls in Andheri 🌹 9920725232 ( Call Me ) Mumbai Escorts...
 

Mapping The M&A Journey

  • 1. Mapping the M&A Journey... Tom Marx and Paul Cooperstein Before leaving on a journey it's always useful to have a map to navigate your way from where you are to where you want to go. As part of our series of white papers, Marx Group Advisors has identified the four basic types of transfer of ownership transactions. This version is the synopsis of the article that is available FREE to our readers. Email Tom Marx (tmarx@marxgroupadvisors.com) for access to a PDF of the entire article. We trust this helps you embark on this journey with greater confidence. 1. Mergers and acquisitions 2. Divestitures and asset sales 3. Joint ventures and alliances 4. Going public or private Mergers and Acquisitions Mergers and acquisitions are the most common forms of these transactions. Typically a merger is a combination of two companies in a stock exchange transaction, i.e. Company A sells all of its corporate stock to Company B in exchange for cash, stock or some combination of both. An acquisition is the purchase of the stock or assets of the business. A merger and acquisition are not mutually exclusive. However a merger is typically thought of in the context of two companies that are of relatively equal size and an acquisition is thought of when a smaller target is purchased by a larger acquirer. Quite a bit of research has taken place regarding the reasons why mergers and acquisitions succeed or fail. Profitability is obviously a factor in every analysis. Some studies have argued that more profitable firms are more subject to takeover than less profitable companies while others have argued that profitability has less to do with the likelihood of becoming an acquisition target. Corporations that are relatively inefficient will be targets of acquisition for more experienced and intelligent acquirers, as well as acquirers that are looking to purchase companies at a highly discounted rate. There are a number of factors why certain companies are acquired and others are not. Some companies acquire companies that are more profitable than they are, some equally as profitable and some less profitable. Some acquiring companies look for target companies that are inefficient and therefore offer the opportunity for significant improvements in efficiency and profitability. Shifts in the capital markets are a significant factor to consider in this process, i.e., in periods of high interest rates or when capital accumulation is difficult. Changes in tax laws like the Tax Reform Act of 1986 can facilitate or inhibit restructuring activity. 2175 E Francisco Blvd. Suite F, San Rafael, CA 94901 • Tel 415-453-0844 • Fax 415-451-0166 • info@themarxgrp.com • www.marxgroupadvisors.com
  • 2. It should be noted that in today's marketplace, cross-border mergers and acquisitions are occurring with more frequency because they often provide an opportunity to capitalize on internal advantages in foreign markets including financial, organizational and technological strengths. Divestitures and Asset Sales Typically divestitures and asset sales are seen as an approach to corporate restructuring that eliminates underperforming assets while capitalizing on the value of a stronger performing asset or simply exiting from a business to repay debt and, in either case, create value. The divestiture process generally includes three approaches to selling the company: the negotiated sale, the controlled competitive sale and the auction. Each of these approaches has different competitive landscapes. Valuations of companies or assets in a divestiture need to undergo the same analysis as a valuation of the company in a merger or acquisition. The most common transaction is the asset sale of a business. This has benefits over other forms of divestitures, most significantly the ability to negotiate with multiple parties in order to obtain maximum value. As in all steps of the M&A process, tailoring the process to the unique needs of the client and an intelligent understanding of the marketplace insures a more intelligent chance of success. Joint Ventures and Alliances A joint venture is a relationship between two or more parties where an independent entity is created by the parties for a specific activity or undertaking. The independent entity is usually jointly owned by the parties and the parties each take an active role in contributing either intellectual property, capital, assets, marketing and sales or any combination of the above. An alliance may not involve the creation of a new independent entity and may not involve any equity contributions by either party. In a time when success in business requires forming relationships between competitors in ways that were unheard of years ago, alliances and joint ventures have become quite commonplace and it's clear that profitability is often created in the formation and operation of joint ventures and alliances which can, in fact, surpass those found in mergers and acquisitions. Going Public or Private Transactions Occasionally we are asked about a going private or going public transaction. A going private transaction is the acquisition of the equity of a publicly traded corporation by an independent privately held entity. In the context of the aftermarket it is usually in the form of a leveraged buyout in which a group of managers (usually with equity partners) acquires an existing business that is publicly owned or a division of the same. We are also occasionally asked to consider the benefits of going public. Either the potential size of the existing company or a rollup of a number of companies with potential to show market rate returns provides an opportunity to consider the benefits of public ownership. Conclusion The underlying assumption in any of the categories or merger and acquisition is that there will be benefits that occur as a result of the transaction. Consolidations continue to recontextualize many industries and have significant impact on the entire supplier and customer chain in a vertical industry. We believe that profitability has far less impact on the ultimate value of the transaction. Instead, strategic advantage becomes more key, whether it allows the elimination of a competitor, gains a valued customer or adds an important product line. 2175 E Francisco Blvd. Suite F, San Rafael, CA 94901 • Tel 415-453-0844 • Fax 415-451-0166 • info@themarxgrp.com • www.marxgroupadvisors.com