MERGERS & ACQUISITIONS

Mergers and acquisitions can deliver great value if well conceived and properly executed.
Successful integration–the key to avoiding the risks of a merger or acquisition and to realizing its potential value–is always a challenge.
It is complicated by the simple fact that no two deals should be integrated in the same way.
It is critical for companies to align their merger integration processes with their deal types and deal theses.

Management Buy-in (MBis) /Buy-out(MBOs)

Every year thousands of companies have to close down for different reasons. In many cases, the company in search of a successor – or at least its client base – is sold to a major enterprise to merge with said enterprise. But if there are people in the company who can imagine to assume the company leadership with all its advantages and disadvantages, a Management Buy-out often happens. If no one is interested in buying the company, which is often the case with smaller companies, the company is liquidated. Transfering the company or parts of the company to one or several external buyers (Management Buy-in) can be beneficial for the seller, the company itself and also for the buyer.

Post Merger Integration

Have all important factors for a successfull PMI been considered?

Which functions of the company have to be integrated quickly? How can synergies be implemented?

How can a homogeneous company culture be created from two different company cultures? How is it possible to avoid conflicts?

How is it possible to keep employées in key postions before and after the integration?

How can you make sure that the employéses keep focussing on their work and their clients, even while the integration happens?

Mergers & Spin-offs

A spinoff occurs when a subsidiary becomes an independent entity. The parent firm distributes shares of the subsidiary to its shareholders through a stock dividend. Since this transaction is a dividend distribution, no cash is generated. Thus, spinoffs are unlikely to be used when a firm needs to finance growth or deals. Like the carve-out, the subsidiary becomes a separate legal entity with a distinct management and board.

Like carve-outs, spinoffs are usually about separating a healthy operation. In most cases, spinoffs unlock hidden shareholder value. For the parent company, it sharpens management focus. For the spinoff company, management doesn’t have to compete for the parent’s attention and capital. Once they are set free, managers can explore new opportunities.

Joint Ventures & Alliances

Alliances go wrong most frequently due to neglect of the first stage–strategy development. We focus companies on ensuring that deals are structured correctly from the outset, with a solid understanding of mutual economics.
Alliances and joint ventures serve many purposes, including filling gaps in capabilities or facilitating new market entry. Several trends drive the value of these partnerships, including:

Shortened product life cycles

Globalization of competition

Increased specialization of skills and capabilities, particularly in high-technology businesses

HNP assists clients through several stages of the joint venture process: strategy development, partner selection, deal structure and operating implementation. We have found that alliances go wrong most frequently due to neglect of the first stage, strategy development. Therefore, we focus disproportionately on ensuring that alliances are structured correctly from the outset, with a very clear, shared vision and a solid understanding of mutual economics. At the same time, we have experience coming into an alliance after problems have appeared and supporting management on a restructuring to optimize value for both parties.

Due Diligence

Implementation of detailed Due Diligence processes

Finances/Balances

Ressources (personal and material)

Market Due Diligence