Buying a Company – A Practitioner’s Guide - Mastering the skill of making a successful acquisition
Short course
In City Of London
Description
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Type
Short course
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Level
Advanced
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Location
City of london
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Duration
1 Day
Main Topics Covered
- How to make a succesful acquistion
- Formulation a strategy
- Investigating the target
- Negotiationg the deal
- Planning the intergration
Facilities
Location
Start date
Start date
Reviews
Subjects
- Buying
- Company Law
- Buying companies
Teachers and trainers (1)
Former Practitioner
Contact us for details enquiries@redcliffetraining.co.uk
Course programme
Course Overview:
Creating shareholder value through the pursuit of a successful M + A strategy has been shown to be a far from risk-free activity. Buyers overpaying or using inappropriate financing methods can lead to destruction of value and in some cases financial distress.
The course covers topics of risk and return, valuation, process, investigation and integration as a practical guide to identifying and negotiating acquisitions.
Course Content:
The Drivers of Growth
- Shareholder value
- The company life cycle
- The importance of directors recognising the value curve
- Risk and return
- Relating risk to the life cycle phase of the company / target
- Product market growth and decline
- Evaluating niches, substitutes, value in innovation
REVIEW: Comparison and contrast of the lifecycle of three different companies, highlighting how success or failure with acquisitions has determined their fate
- ICI
- Debenhams
- GKN
Growth through Acquisition
- Assessing the alternatives
- Investment
- JV
- Acquisition
DISCUSSION: Advantages and disadvantages of each approach
- Determining the acquisition
- Market objectives
- Consolidating a fragmented market
- Building the value proposition
- Management issues
- Assessing cultural fit
- Price parameters
- Knowledge of comparative deals
- Opportunity cost
- Is it a “now or never” deal
- Market objectives
REVIEW: The Ansoff Matrix, a handy way to categorise potential risks in acquisition strategies
- Pitfalls to avoid
- Realism of synergies
- Risks of prediction, cost and achievement
- Accounting standards
- Who is the auditor, what principles are followed
- Judging forecasts
- Scepticism rules
- Realism of synergies
Valuing the Target
- The accounting approach
- NAV
- dividend yield
- P/E
- EV
- The cash flow approach
- DCF
- Terminal value
- Forecasting problems
- Relevance to young / early stage companies
EXERCISE: Using different metrics to value a business
- Other factors
- Target’s history
- Recurring revenue
- Intellectual property
- Customer list
CASE STUDY: Reviewing company information to arrive at a value, taking into account qualitative and strategic factors
The Acquisition Process
- Establishing acquisition criteria
- Target size and affordability
- Potential synergies
- Market / competitor impact
- Regulatory factors
- Shareholder impact
- Due Diligence
- Investigation prior to offer
- Public sources
- Private sources
- Investigation prior to offer
- Verification
- Contracts
- Accounts
- Pensions
- Employee disputes
- Litigation
CASE STUDY: Reviewing summary information on a company to determine which areas need investigation and who should have responsibility for the task
- Structuring the deal
- Earn-out / deferred consideration
- Non-compete undertakings
- Warranties and indemnities
- Disclosure letters
Acquisition Integration
- Success / failure factors
- The importance of the integration team
- Earn outs and accounting issues
- Incentivising key managers
- Establishing clear reporting lines
Buying a Company – A Practitioner’s Guide - Mastering the skill of making a successful acquisition