Acquiring Middle Market Companies CFE Recap

Acquiring Middle Market Companies CFE Recap

October 10, 2016

The September 23rd Center for Free Enterprise event was our 7th consecutive sellout – another capacity crowd interested in sharing their experiences, learning how to buy a business, and meeting like-minded entrepreneurs in the area.

The Center for Free Enterprise was founded by myself and and David Brown of Red Hawk Associates, Ltd. just 16 months ago. With another strong panel of experts, we were blessed with our largest and most active crowd yet.

A special thank you goes out to our sponsor Key Private Bank, and to our panelists and all participants for what was a most informative program. Responses from attendees indicated that their only criticism of the program was that it ended way too soon!

It’s not too early to mark your calendar for our next CFE program to beheld at the Cleveland Racquet Club in the early morning on November 19, 2016. We anticipate that tickets will again sell out fast!

Ben

Acquiring Middle Market Companies in 2016: How We did it…

The Center for Free Enterprise September 23rd, 2016

Venue: Cleveland Racquet Club

On September 23rd, 2016 The Center For Free Enterprise hosted an event to learn how to invest in middle market companies, valuation approaches and how to get deals done to buy a business. The event was a success with the help from the panel made up of Kirkwood Holding’s esteemed deal team. The panel included Donna Ross, VP of finance and treasurer of Kirkwood and Jennifer Vergilii, partner at Calfee in the Firm’s Mergers & Acquisitions practice group and David Brown, who helped source Kirkwood’s Swissline transaction.

Ross began the event by telling the attendees the history of Kirkwood Holding’s and how they formed successful acquisitions. Some great advice that Ross gave to the attendees was to get to know the owner of the business they are selling and see what is important to them, because two-thirds of businesses are from acquisitions.

Kirkwood specializes in precession machining, and when considering a potential acquisition Kirkwood sought primarily mom and pop shops that had equipment and operations similar to what Kirkwood was familiar with. Brown also touched base on what businesses Kirkwood targeted and how they went about contacting those businesses.

Additionally, Vergili added commentary over Kirkwood’s due diligence which includes a risk/reward analysis and a methodical breakdown of a potential acquisition’s assets, earnings, inventory and background. Vergili also stated what a business should avoid when they’re acquiring another.

Overall, it was an excellent event with an intrigued audience which included an assortment of professionals from fields ranging from Aerospace to Sports. The audience received practical knowledge that will assist them in obtaining acquisitions.

Here are some key takeaways from the panel:

  • Useful tools like LinkedIn, phone and e-mail to find target businesses
  • With business proposals you should educate the seller of the sale process and send the request list in pieces to avoid overwhelming the seller.
  • In the acquisition agreement you want to address all issues so there are no surprises
  • When acquiring a company it is important to keep certain local management in place which was their before the acquisition.
  • It is crucial to have the right team in place in acquisitions, including lawyers, brokers and bankers.
  • If an acquisition does not go through at first, do not burn bridges because often times a seller will want to negotiate again in the future.
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