Business Owners: We are able to match Business Owners with strategic investors thanks to our network in the Middle East. The main requirement for strategic investors is to be able to add value to the business they are investing in.
Investors: We look for minority investment opportunities in SMEs located in the Middle East, which have proven business models and are looking to grow their business further. Potential investors would need to be strategic stakeholders with a DNA allowing them to understand and help grow the business they are investing in.
We provide assistance for both the buy side and the sell side and our mandates cover the entire process from opportunity identification to close
Traditional valuation models typically analyze comparable transactions and industry multiples or build a discounted cash-flow model based on the stand-alone value and likely earnings trajectory of the seller. As we believe in a far more rigorous approach to valuation in order to make sure strategic investors are paying a fair price, we strive to achieve the following:
To determine how much value is really at stake, we consider every aspect of the transaction and conduct a systematic review of the seller’s business. This allows investors to be aware of the risks associated with the opportunity as well as the strengths that can be built upon and the weaknesses that can be resolved.
We don’t base a company’s projections of future earnings on historical performance. Instead, we talk with Business Owners about their current performance and research their respective market to identify the growth drivers. This then allows us to determine how well the company is positioned to take advantage of these growth drivers.
Acquiring a stake in a business is a calculated risk which is why conducting a thorough due diligence is such an important step in the M&A process. If done right, it helps investors minimize risk and gives them the confidence that they can actually create sustainable value through the acquisition. Below are the typical due diligence steps to conduct:
The questions that we aim to answer are the following:
+ What is the position of the seller vis-à-vis its competitors?
+ Are there any disruptive challenges or threats to the business model on the horizon?
+ How will the transaction help the acquirer and the seller create new opportunities for growth?
The questions that we aim to answer are the following:
+ Are the top-line growth assumptions overly ambitious when compared to the market?
+ Have the cost assumptions been pressure-tested against achievable benchmarks or possible external shocks?
+ Have all remaining assumptions been challenged?
This part of the due diligence process seeks to provide a solid understanding of the underlying trading profile, quality of reported earnings, working capital funding requirements, identification of debt like items and a robust review of future cash flows.
Our objective is to gain a thorough understanding of a seller’s operations and its risks. In so doing, we identify performance gaps and the potential for rapid improvement through for example cost optimization and operational restructuring.
In order to match Business Owners with strategic investors, we determine the kind of value the buyer can unlock, either by:
- Optimising the way the acquisition is engineered
- Integrating the company within the buyer’s core business
- Facilitating the company’s access to new markets and clients.
We manage the due diligence process from start to finish including the management of all the involved stakeholders such as consultants, lawyers and regulators.
The financial model aims to translate complexity into financial insights in order to increase the decision making confidence of strategic investors. They are tailored, fit-for-purpose and logically structured.
Strategic investors shouldn’t wait for the closing of the transaction to start planning for the integration. Instead, PMI planning should be an integral part of the deal negotiation so that buyers are prepared to rapidly realize the available synergies. In order to achieve a successful PMI, we help investors focus on the strategic objectives of the deal, accelerate synergies and work towards building a highly efficient organization.
The sale and purchase agreement contains all the details of the transaction so that both parties share the same understanding. Among the terms typically included in the agreement are the purchase price, the closing date, the amount of earnest money that the buyer must submit as a deposit, the list of items that are and are not included in the sale and the warranties and indemnities.
The financial terms of the Sale and Purchase Agreement (SPA) are critical when buying a business as investors will seek appropriate protection if the seller’s financial position is not as expected.
Working closely with our lawyers, we provide support throughout the SPA drafting and negotiation process, identifying commercial issues early and ensuring these are appropriately reflected in the SPA.
We assist investors in the process of determining the optimal debt to equity ratio to finance the transaction. Our relationships with some of the leading private banks in Switzerland allow us to provide investors with competitive sources of debt.
In the current economic climate where industry trends are changing rapidly as a result of technology and increasing globalization, products and services are becoming obsolete faster. This highlights the need for companies to embrace innovation not only to remain relevant but more importantly to stay ahead of the curve.
For many companies however, innovation is a completely misunderstood and underappreciated topic. They don’t know what it involves, if they need it, how to implement it and how to encourage employees to innovate.
We therefore assist investors with a complete suite of consultancy services in innovation so that their companies can improve operational processes, develop new products and services, revisit their business model and develop a corporate culture that encourages employees and senior management to generate ideas and transform them into profitable innovations.
To achieve these objectives, a scientific method is employed to evaluate ideas which removes subjectivity from the appraisal process and which produces an exhaustive analysis of each idea.