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Growth through acquisition isn't just for the big companies

It is not unusual to hear of a conglomerate acquiring another company to achieve market share or to help it branch into a new field. However, the trend does not just involve mega companies.

Growth through acquisition is a valid strategy for businesses in the lower mid-market as well as the mid-market. Like their larger peers, smaller entities are reaching out to acquire other businesses to achieve growth, to find new talent, to get into new markets.

Members of the BTS team have been working with several companies in recent months to help them identify a target for acquisition.

There are several phases for most projects of this type.

Defining and clarifying the goals. The advisor works with the owner and management team to clarify what is sought and why.

Identifying potential targets. Sometimes the buyer has companies in mind, but generally the best prospects are found during a confidential search.

Finding the synergies. The acquisition has to make sense, and relate directly to the strategy that has been developed during the early stages.

Framing the deal. An acquisition will require a formal offer to purchase, completion of diligence and development of an integration plan, which should be done before the formal agreement is signed.

Regardless of size, growth through acquisition is becoming a more common approach for smaller entities to remain competitive and to develop a stronger market presence.

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BTS News

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Case Studies

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    Initially, liquidation was a serious consideration. It would offer a quick exit but would hurt loyal employees and disrupt the customers who had come to rely on its quality production.

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    Our client owners could dig in for the long haul…However, this would take five years or more. Owners simply lacked the horsepower to do it.

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  • Water Purification Company and Young Buyers

    Owners decided they wanted to retire. They also wanted to be fair to the staff who had been loyal to them. Could the company be sold, the staff retained and the facility remain in use?

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  • Magnetics Company with High Profile Customers

    (T)he manufacturer would need to focus on growing EBITDA to capture interest from major strategic buyers and achieve a higher multiple of earnings.

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