In buying any company there are several major points that must be addressed;
- Due Diligence – on the target company and the market place, its competitors and market share.
- Financing Strategies – how is the purchase to be financed? When purchasing a company there are many different financial structures and methods that can be adopted. It is not always a matter of writing out a cheque or getting a bank loan to purchase. ICS develop bespoke methods to maximise the buyers options.
- Purchase Methods – A group structure, MBO or phased / structured purchase. Offshore companies and trusts may be employed to maximise tax advantages.
- Structuring – Purchase parts of a company or the whole group. How it is structured is extremely important to ensure that financing strategies and financing options are optimised and in the event of immediate turn-around, the structure must be ‘stand-alone’ and identifiable.
- Accounting Systems – Understanding the accounting methods of the target company and ensuring that no historic ‘financial trickery’ has been used by the target company’s present owners to hype the values or mis-represent the financial statements.
- Staffing & Management – Installing your own Board and Chief Executive and deciding who is an asset and who is a liability.
- Price Earnings Ratio – the key to successful acquisitions.
As well as these, it is also important to keep an eye on your objectives. Is the purchase of the company to merge with existing business, buying out a competitor, or is the objective to restructure and grow the company toward a public offering?
In any event, you will need to have identified a competent Chief Executive and Board to work alongside the outgoing management. A purchase should be planned to ensure that the structures are completely understood and will remain in place until the incoming management have had time to restructure to their own methods otherwise you could be buying a headless chicken.
ICS have access and experience in undertaking extensive due diligence on target companies and the individuals behind them. We can plan and acquire the finance and funding needed to make the purchase and negotiate the point of entry.
Through our extensive international partnerships, we can ensure that you have the right people at senior executive level to ensure that the plan is effected with precision and discipline and all objectives are met on time.