
My Business is Having a Soft 2020 due to COVID, But I’m Ready to Sell. Should I Test the Market?
Yes, especially if you believe your business will rebound in the next 1-2 years to pre-2020 revenue and EBITDA levels. Private equity firms exist to
Our team has created more than $100,000,000 in equity value in the past 24 months.
Our team has negotiated thousands of contracts with major OEMs and their tier 1 suppliers, and we know what these customers will – and won’t – agree to. While your family attorney may be a terrific advisor, we suspect he or she will not have the depth of experience negotiating key commercial terms. We know what terms are reasonable and we know what terms investors expect to find in the companies they acquire.
We use detailed metrics and decades of experience to institute processes that will make your business more profitable. These include the processes and know-how to improve machine output, accelerate changeovers, improve quality and reduce scrap, and reduce downtime. Along with that, we know how to reduce unnecessary expenses, adopt the “right” automation for the application, adopt leading preventative maintenance strategies and institute more cost-effective inventory management. Please see our Case Studies for a few recent examples of the turnarounds that our team has managed.
We have longstanding relationships with major OEMs in aerospace, packaging, medical device, food production and plastic injection molding. We also have relationships with the prime suppliers to those OEMs. We offer to represent our clients before those customers. If you’d like to supplement your sales effort, and take advantage of those relationships, we’re here to help.
AIS can help smaller companies reduce inventory levels, reduce raw material costs, and improve terms with their suppliers by leveraging a consortium-buying model, leveraging larger volumes with preferential supply agreements. We can also help optimize the supply base to ensure that you are working with the best suppliers for your needs. Oftentimes a company's supply base is developed based on handshake agreements and prior personal relationships. While relationships are essential for business, it is equally important to reassess your supply base when either your needs change or the market changes.
Our M&A team included a seasoned M&A attorney that represented private equity funds in acquisitions in more than 200 transactions. We know what these investors can and will agree to in a transaction, to drive the best possible deal terms and ensure that you maximize your sale proceeds. From a marketing standpoint, we are connected to over 400 potential financial sponsors and scores of potential strategic acquirers. And, given our industry relationships, we will continue to broaden our investor network as we better understand the unique value proposition of your business.
Financial improvement comes from more sales, lower costs, or both. We discuss sales growth elsewhere, but there are ample opportunities to improve your business that directly tie to financial results. These include where you can raise prices, charges your competitors are using, what you can charge for, customer management, an negotiating terms to name a few. We can help move suppliers to just-in-time fulfillment, rethink personnel and responsibility, along with many other methods. This is not meant to be an exhaustive list but an illustration of the benefits that come from having access to an Advisory Board of industry experts who have decades of experience driving business improvement.
Yes, especially if you believe your business will rebound in the next 1-2 years to pre-2020 revenue and EBITDA levels. Private equity firms exist to
While not universal, the most common practice is to take a target company’s EBITDA (which may be an adjusted number) or its EBITDA less CAPEX
A strategic buyer is an operating company that wants to add your business to its business to drive its strategic objectives. A “financial” buyer is