Valuation 101: the EBITDA Multiple HELLO WORLD

Last month we took a high-level look at different approaches to valuing a company. We noted that, because of their ability to reflect the future economic benefits of an ongoing business, cash flow methodologies are most commonly used in business valuation. These include applying a multiple to an income or cash flow number, capitalizing cash […]

Overview of Valuation Methods HELLO WORLD

Correctly valuing a business is central to any successful M&A transaction. As much art as science, valuation strives to quantify the financial benefits of owning the business today and in the future. Here we kick off a series of articles examining different valuation approaches, limitations, and best practices. This piece introduces the core principles of […]

Acquisition Integration HELLO WORLD

Chess board merger

Last month, we discussed how acquirers can select and work most productively with an M&A advisor. Here we conclude this buy-side article series with a look at acquisition integration. Though we typically end our formal engagement at deal closing, we always emphasize acquisition integration for two reasons: 1. Regardless of how rigorous your selection, due diligence […]

Working With an M&A Advisor HELLO WORLD

Last year’s articles have walked through the process of purchasing a company, viewed from the acquirer’s perspective. Before moving on to acquisition integration, let’s pause and look at how to work with your M&A advisor.   Role M&A advisors can provide a wide range of services. Understanding the possibilities, and identifying which services are of […]

Conducting Due Diligence HELLO WORLD

Business man presenting financial analysis

Implicit in our previous article’s discussion of the M&A pipeline is the need to move from a pool of initial candidates, often numbering 100 or more, to perhaps 1-2 good acquisitions. After high-level screens have weeded out the less attractive possibilities, and detailed analysis of publicly available information has further distilled the list, we may […]

Building a Strong Acquisition Pipeline HELLO WORLD

Pipeline over water

The last article looked at sources of target company value, and their importance based on the purpose of your acquisition. Continuing in the Search and Assessment stage of our framework, let’s now turn to the mechanics of building a strong pipeline. Figure 1. Stillwater Capital Acquisition Framework What is a pipeline? Your pipeline is a […]

The Importance of Value Drivers When Assessing Targets HELLO WORLD

Having established the importance of corporate strategy as the starting point for any deal and introduced possible acquisition types, let’s shift attention from the Strategy stage of our framework to Search and Assessment (Figure 1). What value does a potential target bring, and where do we find good quality targets? Let’s start with value   […]

Aligning Acquisitions With Corporate Strategy HELLO WORLD

Meeting

The last article shared a framework we use to guide clients through their acquisition decisions in a disciplined way, and explored the four questions every acquirer must be able to answer. Here we dig deeper into the first step in the framework, and the question of purpose, looking at the alignment of acquisitions with corporate […]

Beware the EBITDA Multiple Trap HELLO WORLD

Services and Transactions

In today’s M&A environment, an EBITDA multiple is by far the most common methodology employed to value a privately owned business.

The Forgotten Balance Sheet HELLO WORLD

When valuing a business, most company owners are worried about the income statement. But experienced valuators and investment bankers always consider the balance sheet. The balance sheet sets out critical information about the financial strength and weakness of the company.

Successful Acquisitions Require Successful Integration HELLO WORLD

Successful Acquisitions

The success or failure of an acquisition depends on how the target is integrated. Successful integration requires a clear understanding of what is being purchased.

Should I Sell My Business? Questions to Help You Decide. HELLO WORLD

Should I Sell My Business?

The most fundamental question to ask yourself in deciding whether you should sell your business is why?