M&A

Mergers and Acquisitions

Standard M&A

 

Standard M&A

 

Liquidity

Mergers and acquisitions (M&A) is a general term that refers to the sale of a company or consolidating two companies, typically generating meaningful upfront liquidity for the selling business owner. Through a variety of tax-driven structures, these transactions may include asset sales, stock sales, IRC 338(h)(10) or IRC 368(a)(1)(F) as the most common structures employed.

Buyer’s may be either strategic companies within a related industry, a financial buyer looking to acquire a platform investment in the segment, or a new or existing management team looking to acquire the business from the Sellers.

Depending upon a Seller’s personal objectives, an M&A transaction may result in the sale of 100% of the ownership, a majority sale, or a minority sale. Establishing a deep understanding of the Seller’s objectives is critical to selecting an optimal transaction structure and potentially a desired ongoing equity interest.

Ambrose is a trusted provider in M&A transactions representing Sellers, Buyers and management teams.

Owner and Stakeholder Benefits

Owner and Stakeholder Benefits
  • Transaction structure designed to create liquidity for shareholders in the most tax-efficient manner possible;

  • Ownership transition plans established up-front between Buyer and Seller;

  • Upfront cash typically higher than other liquidity options;

  • All proceeds except for escrowed amounts normally paid at close;

  • Detailed non-disclosure agreements executed between Buyer and Seller to minimize risk of employees, suppliers or customers learning of a transaction prior to close;

  • Financial buyers typically pose less of a competitive threat to a Seller during the due diligence process while strategic buyers are allowed access to highly sensitive due diligence information late in the process;

  • Financial buyers typically provide better continuity for the existing corporate culture and retain the owners’ legacy;

  • Well-capitalized Buyers can execute a strategic growth plan to create industry consolidation and leverage economies of scale or invest in organic growth programs in order to capitalize on market potential.

Employee Benefits

Employee Benefits
  • Financial buyers may offer key managers co-investment rights up-front on a pari passu basis alongside their equity;
  • Financial and strategic buyers typically create a management incentive plan or options pool for senior management to create a win-win partnership and ensure employee retention;
  • Ongoing roles for key individuals may be negotiated up-front depending upon the synergies with the strategic buyer;
  • Many strategic buyers have more generous employee benefits plans for employees than most privately-held companies.

The Ambrose M&A Advisory Approach

 

The Ambrose M&A Advisory Approach

Coordinated team of professionals

M&A transactions require a coordinated team of professionals including an investment banker like AmbroseAdvisors™, the Seller’s CPA, Seller’s legal counsel, Seller’s wealth manager, insurance providers, Buyer’s CPA, Buyer’s legal counsel and third-party lenders to the extent outside financing is required. Ambrose coordinates its efforts with all constituents to ensure a smooth M&A transaction.

  • Investment Banking: Valuation analysis, deal marketing, projection modeling, transaction structuring, soliciting proposals, negotiations, leading the transaction execution, resolving open issues, completing documentation, transaction schedule coordinating, funding and closing;
  • Transactional Support: Managing due diligence, transaction negotiations, build-out an e-data room, selection of transaction insurance
**Certain Investment Banking Services Through: ShorelineAmbrose Advisors, LLC Member FINRA/SIPC