OUR SERVICES: FROM SALE TO ACQUISITION
SELL-SIDE
— TYPICAL SITUATIONS —
01
FOUNDER-CEO PREPARING FOR RETIREMENT
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02
SME SEEKING TO JOIN FORCES WITH A PARTNER
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03
GROUP WISHING TO DIVEST A BUSINESS UNIT
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CONTEXT
Owner-manager of an SME in the French defense industrial base (DTIB) wishing to pass on the company.
KEY QUESTIONS
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What is a realistic timeline for the transaction?
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How can the value of the assets sold be maximized?
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What deal structures are possible, and what are their tax implications?
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How can the business be passed on in line with the shareholders’ agenda, or as part of a family succession?
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How can an organized process be run that ensures genuine competition among potential buyers?
OBJECTIVES
Achieve the best valuation without compromising the company’s identity or its employees’ future.
OUR SUPPORT
Valuation of the company and proposal of a sale structure (timetable, key points of attention…).
Preparation of the marketing materials (teaser, information memorandum, business plan…).
Identification, selection and confidential approach of credible potential industrial or financial buyers.
Advising the shareholders during negotiations (price, warranties, seller’s involvement during the transition…).
Coordination of all advisers and parties through to the signing of the sale agreement and closing.
CONTEXT
DTIB SME whose development requires additional resources (production capacity, access to major programs, exports…) and whose founders wish to remain in charge.
OBJECTIVES
Finance growth without losing control of the industrial project.
KEY QUESTIONS
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Which structure to choose: a minority capital opening or a gradual tie-up with a partner?
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What level of dilution is acceptable, and what governance should be put in place?
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How can the arrival of a partner be reconciled with sovereignty constraints (security clearances, foreign investment screening…)?
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How can a balanced agreement be built for both parties?
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How can deferred consideration (such as an earn-out) be provided for without hindering the company’s development?
OUR SUPPORT
Identification of DTIB industrial partners or investors compatible with sovereignty requirements.
Review of complementary sources of financing (bank debt, IPO…).
Assessment of the quality of the assets contributed (contributions in kind) or of the terms of the capital increase.
Analysis of the capacity to integrate the acquired assets.
Negotiation of governance, the founders’ role and the principles of the shareholders’ agreement.
CONTEXT
Group or mid-cap company wishing to refocus its portfolio and divest a subsidiary or business unit.
KEY QUESTIONS
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Should the legal entity be sold, or only the company’s assets?
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How can the loyalty and motivation of the existing management be secured to defend the shareholder’s interests?
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How can the business be positioned in the most attractive way for each potential buyer?
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How should the process be organized, and which advisers should be brought in (financial and/or legal vendor due diligence)?
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How should internal communication be managed, and how can the impact on business performance be limited?
OBJECTIVES
Secure the future of the business and its teams without disrupting the rest of the group.
OUR SUPPORT
Definition of the perimeter (teams, assets, contracts, security clearances).
Informal, no-names sounding of potential buyers’ interest.
Preparation of carve-out financial information and of post-sale transitional services.
BUY-SIDE
— TYPICAL SITUATIONS —
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01
MID-CAP COMPANY
PURSUING
EXTERNAL GROWTH
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02
GROUP SEEKING TO ENTER
(OR EXPAND IN) THE
DEFENSE MARKET
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03
INVESTMENT FUND
PURSUING A
BUILD-UP STRATEGY
DISCOVER ▾
CONTEXT
Industrial mid-cap company in the DTIB wishing to strengthen or diversify through acquisitions (consolidation of its market, moving up the value chain, access to new customers, international expansion…), without a dedicated in-house M&A team.
OBJECTIVES
Complete a value-creating acquisition with risks under control, without overstretching senior management.
KEY QUESTIONS
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How can relevant targets be identified, including companies that are not officially for sale?
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How should a target be valued, especially a loss-making company with turnaround prospects?
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How should the transaction be financed, and what will it cost?
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What negotiating strategy should be adopted with the seller?
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When and how should the integration of the company being acquired be prepared?
OUR SUPPORT
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Definition of acquisition criteria and target search.
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Initial approach of targets and analysis of the information provided (financial statements, document and question lists).
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Valuation and proposal of acquisition structures (leverage, payment in shares or cash, accretive or dilutive effect).
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Assistance in raising financing and presenting the transaction to shareholders.
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Leading negotiations and coordinating due diligence through to the signing of the purchase agreement and closing.
CONTEXT
Large group with an in-house M&A department, seeking to enter the defense market or needing sector experts to handle a specific and/or sensitive deal.
OBJECTIVES
Secure an acquisition in a sector with specific rules, alongside in-house teams.
KEY QUESTIONS
Which players should be targeted, and how should their owner-managers be approached?
How should sector specifics be factored in (security clearances, war materials authorizations (AEMG), national defense secrecy, foreign investment screening, ITAR…)?
How should the target’s position with its government customers and on major programs be assessed?
How should due diligence be organized and the main risk areas identified?
How should identified risks be covered, in the purchase agreement or in the price?
OUR SUPPORT
Additional sector expertise or resources for the group’s M&A teams.
Mapping of players and access to target companies’ executives.
Analysis of defense-specific regulatory constraints and their impact on the timetable and structure of the transaction.
Acting as intermediary between buyer and seller to ease tensions and smooth information exchange.
Advice on sensitive matters and involvement through to signing and closing.
CONTEXT
Investment fund that has invested in an Aerospace & Defense company and wishes to accelerate its development through successive acquisitions.
OBJECTIVES
Build a coherent group by completing several targeted acquisitions within a controlled timeframe.
KEY QUESTIONS
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How can a steady flow of complementary, qualified targets be built?
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How can founder-managers, often attached to their independence, be convinced?
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How should each target be valued and the transaction structured (seller reinvestment, earn-outs…)?
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How can sovereignty constraints linked to a fund entering the capital be anticipated?
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How can several acquisitions be completed in succession without weakening the integration of earlier ones or overstretching the management team?
OUR SUPPORT
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Identification and qualification of targets complementary to the platform company.
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Approach of owner-managers with a message tailored to their expectations.
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Target valuation and proposal of acquisition structures.
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Leading negotiations and coordinating advisers (lawyers, auditors, lenders).
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Sequencing of transactions and support through to signing and closing.
ADVISORY
— TYPICAL SITUATIONS —
01
TARGET SEARCH
(FRANCE AND EUROPE)
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02
BUSINESS PLAN REVIEW (INDEPENDENT BUSINESS REVIEW)
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03
TAILORED STRATEGIC ADVISORY
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CONTEXT
Mid-cap company wishing to grow through acquisitions and to take a proactive approach, in order to find targets that can be negotiated on a bilateral basis and that match its needs more closely than those put up for sale through auctions.
OBJECTIVES
Find companies whose owners, often nearing retirement, have not started a sale process and would rather ensure a gradual transition with an industrial player from the sector, in a cooperative setting and without employees being informed during the negotiation phase.
KEY QUESTIONS
What is the desired size of the acquisition and its core market?
What are the critical search criteria, and what flexibility can widen the range of opportunities?
What level of confidentiality should surround the acquirer’s approach?
OUR SUPPORT
Access to sector databases and knowledge of the state of the DTIB M&A market.
Critical analysis of the strategic rationale for the acquirer in light of the feasibility of the acquisition.
Informal sounding of the targets selected by the acquirer, on a named or no-names basis.
CONTEXT
SME or mid-cap company wishing to challenge the forecasts of its defense business plan before sharing it with third parties, whether industrial or financial.
OBJECTIVES
Prepare ambitious assumptions on the company’s financial outlook without the risk of the business plan being contradicted or legitimately criticized as overly optimistic.
KEY QUESTIONS
How can a credible business plan be built, and over what period?
How long will the business plan be used, and how should it stand the test of time?
What level of transparency is required, and how detailed should the information provided be?
OUR SUPPORT
Interviews with potential customers.
Informal sounding of relevant players in the defense ecosystem.
Overall assessment of the financials after analysis of all available financial information.
CONTEXT
Group or mid-cap company seeking sensitive information on consolidation in the defense sector.
OBJECTIVES
Prevent a competitor from entering a sensitive defense market through the acquisition of a company, without having to invest oneself; guard against a bid from a potential competitor in an M&A auction process.
KEY QUESTIONS
How can information on the subject be obtained?
What levers are available to thwart a competitor’s intentions?
What support can be obtained from the ecosystem, the French defense procurement agency (DGA) or France’s foreign investment screening regime?
How can the decision criteria of the various stakeholders be understood?
How should the matter be communicated?
OUR SUPPORT
Understanding the need and setting up the required organization.
Informal, no-names sounding of potential buyers’ interest.
Gathering reliable information by activating a network of contacts.
02
SME SEEKING TO JOIN FORCES WITH A PARTNER
DISCOVER ▾
03
GROUP WISHING TO DIVEST A BUSINESS UNIT
DISCOVER ▾
02
GROUP SEEKING TO ENTER (OR EXPAND IN) THE DEFENSE MARKET
DISCOVER ▾
03
INVESTMENT FUND PURSUING A
BUILD-UP STRATEGY
DISCOVER ▾
02
BUSINESS PLAN REVIEW (INDEPENDENT BUSINESS REVIEW)
DISCOVER ▾
03
TAILORED STRATEGIC ADVISORY
DISCOVER ▾