Conversations with Thought Leaders from the M&A Community
Tom Turner – Deutsche Bank Principal Finance – Credit Market Update
Posted on July 23, 2008
Disclaimer: The opinions or recommendations expressed are those of the author and are not representative of Deutsche Bank AG as a whole.
Tom Turner is a Vice President in the Principal Finance Group of Deutsche Bank, the world’s sixteenth largest bank ranked by shareholder equity. Principal Finance delivers global expertise across a wide range of markets, industries and asset classes. The Principal Finance group provides leveraged financing solutions to middle market and larger borrowers. It can provide liquidity for both performing and non-performing assets in transactions ranging from $20 million to $2 billion. Acting on a principal basis, DB can execute transactions that otherwise may not be possible in traditional capital markets. Investments take the form of senior, subordinated or mezzanine debt, customized credit derivatives and selected equity.
- Focus areas include:
- Illiquid Asset Financing
- Acquisition financing
- Contract monetization
- Project/Infrastructure finance in developed and emerging markets
- Renewable energy financing
In this interview Tom talks about the current state of the credit markets and gives his insight as to the future course of the liquidity crisis currently underway. Prior to joining Deutsche Bank, Tom was employed on the agency side of the street where he was responsible for managing debt financings in aggregate principal amount exceeding $50 billion.
Length: This audio interview is about 23 minutes long.
Categories: Strategic Buyers, Intermediaries, Merger Integration, Industry Sectors, Private Equity, Financial Planning, Business Sale, Business Acquisition, Negotiation, Valuation, Audio
Tags: acquisitions, cross border M&A, M&A, mergers, mergers and acquisitions, multinationals, Private Equity
Andy Greenberg – Valuing Middle Market Companies
Posted on May 9, 2008
Getting real valuation data on lower middle market acquisitions by private buyers has always been one of the most elusive aspects of the M&A business. While there have always been a number of data services available that highlight the valuation of most public company deals, these sources provide only spotty information on private transactions.
Our guest today is Andy Greenberg co-founder and CEO of GF Data Resources of W. Conshohocken, PA. GFDR is a relatively young company which collects, analyzes and reports on private equity-sponsored M&A transactions in the $10 million - $250 million value range. The firm has analyzed more than 500 transactions, reported by about 80 private equity firms, and provides industry drilldown data in more than 100 NAICS categories and sub-categories.
GFDR was launched by two Philadelphia-based deal professionals, Andy Greenberg and Graeme Frazier, who were frustrated by the scarcity of accurate data on middle market transactions. GF Data Resources offers its reports to subscribers on a quarterly basis and soon will make detailed valuation data continuously available through its website, www.gfdataresources.com.
You can access publically available summaries of information provided to the GFDR’s subscribers by clicking here. One of the most interesting data points that the company provided in its 2007 yearend report is the chart below, which confirms everyone’s suspicion that 2007 was a particularly good year for sellers of middle market firms, notwithstanding the market downturn in the second half of the year. Purchase multiples averaged 6.3 times EBITDA in 2007 plus Buyer’s Transaction Expenses (BTE) which added another 4.4% to the purchase price or an additional .3 times EBITDA.
Length: This audio interview is about 17 minutes long.
Categories: Private Equity, Strategic Buyers, Financial Planning, Valuation, Business Sale, Business Acquisition, Audio
Tags: acquisitions, Business Sale, M&A, mergers, mergers and acquisitions, Podcasting, Private Equity
Geoff Alexander - Where to go When the Bank Says No
Posted on April 26, 2008
It’s no secret that banks have tightened their credit standards in recent months. As you can see from the chart below, we are in the midst of the third such period of tightening since 1990 and there doesn’t appear to be an end in sight. The shaded area indicates periods of recession that followed the earlier credit crunches.
This week’s interview is the first in a series covering financing alternatives for middle market businesses trapped in the credit squeeze. Our guest, Geoff Alexander, is Director - New Business Development for The Comvest Group, a private equity firm that has created a fund called Comvest Capital, to meet the financing needs of growing middle market companies with revenues from $15 million to $500 million. Comvest Capital provides a diverse range of financing alternatives, including mezzanine debt and growth equity as well as unitranche or one stop shop solutions. In recent months Comvest has been quite busy working with companies that have been pushed out by existing lenders that are tightening their credit standards.
Geoff is responsible for sourcing new deal flow and analyzing prospective investments for Comvest. Prior to joining Comvest, he worked as a Senior Associate at hedge fund PDP Capital Investments. Mr. Alexander graduated from Berea College with high academic honors and a degree in Business Administration with a Finance Concentration.
Length: This audio interview is about 19 minutes long.
Categories: Industry Sectors, Private Equity, Financial Planning, Audio
Tags: acquisitions, Podcasting, Private Equity
James O. Futterknecht, Jr - A Pioneer of Private Equity
Posted on April 16, 2008
Our guest today, Jim Futterknecht, has witnessed the private equity industry almost from its beginning. Jim has been involved in the automotive OEM supply industry since joining Excel Industries, Inc. as a line foreman in 1970. He served in a variety of sales and sales management roles at Excel in the 70’s and was elected Vice President of Sales and a member of the Board of Directors of Excel in 1976.
In 1983 Jim was part of a senior management group that purchased Excel in a highly leveraged buyout engineered by Hammond, Kennedy and Whitney Co. Back then there were no “private equity” firms. They were called LBO shops. Excel was the sort of buyout that most investors can only dream of, growing from $40 million in revenues at the time of the acquisition to a public company with over a billion dollars in revenue at the time of its sale.
Over time Jim’s role expanded into operational responsibly as well as sales. In 1986 he led a strategic project resulting in Ford Motor Company becoming Excel’s largest shareholder, largest customer, and largest supplier. In 1990, he was elected Executive Vice President and in 1992 promoted to the position of President and Chief Operating Officer. He became Chairman, Present and CEO in 1995. In 1999 Jim led the merger of Excel into Dura Automotive Systems, Inc and joined the Dura Board.
Jim is currently a partner in Hammond, Kennedy and Whitney Co., a small cap private equity firm (www.hkwinc.com). Jim is a graduate of the University of Texas at Austin (1969), happily married for 37 years, and the proud father of 2 adult daughters.
Length: This audio interview is about 27 minutes long.
Categories: Private Equity, Industry Sectors, Negotiation, Business Acquisition, Business Sale, Audio
Tags: acquisitions, cross border M&A, M&A, mergers and acquisitions, multinationals, Private Equity
Michael Wolverton - Accessing Private Equity Buyers
Posted on April 9, 2008
When I first became active in M&A there were perhaps 150-200 private equity firms (then called LBO shops) in the United States. Today there are probably 1500-2000 such firms which collectively own at least 20,000 portfolio companies. Additionally there are myriad Sovereign Wealth Funds, international private equity firms, family offices and hedge firms active in the U. S. M&A market.
Matching a specific deal with those financial buyers most likely to be interested in that specific deal from an industry, size and risk perspective is a very difficult challenge akin to finding that proverbial needle in a haystack. Our guest today, Michael Wolverton has developed a unique approach to meeting this challenge. Michael is the founder and president of Cathedral Partners located in the Philadelphia suburb of Conshohocken.
Cathedral enhances communication between private equity firms and intermediaries by creating a platform that allows for confidential, controlled and efficient communication between its members. By acting as a single connectivity point for buyers and sellers, Cathedral allows intermediaries to expand their reach while allowing private equity firms to augment their deal flow.
Prior to founding Cathedral Partners, Michael was responsible for leading the business development efforts of LLR Partners, a $620 million private equity firm based in Philadelphia. Before LLR, Michael served as Vice President for Penn Capital Management, a $4.5 Billion asset management firm. Michael received a BS in Finance from the University of Pittsburgh.
Length: This interview is about 17 minutes.
Categories: Intermediaries, Private Equity, Business Acquisition, Business Sale, Audio
Tags: Business Sale, M&A, mergers, mergers and acquisitions, Private Equity
Doug Rodgers - The World Takes Center Stage
Posted on February 4, 2008
Like many of you in our industry, I have spent the last month trying to understand the impact of the credit squeeze and the equity and debt market declines on the M&A market. I don’t purport to have the answer to where the stock market will be next month or even whether we are going to really have a recession (though my personal guess is that we’ve been in a mild contraction over the last ninety days and if we’re lucky we may already be nearing the end of the slide).
What I do see clearly is that the current events are part of a much larger picture in which the U. S. economy has become a major player in a multipolar world and no longer the dominant economic factor in the world scene. For an interesting perspective on this subject, read Parag Khanna’s article in the January 27, 2008 New York Times entitled Waiving Goodbye to Hegemony.
Even more important to our industry is the coming emergence of the transnational corporation as a dominant force in world economics. I purposely use the term transnational rather than multinational, because these future behemoths will no longer be tied through ownership or political control to any specific nation or even any specific regional bloc. Their operations will be spread around the globe reflecting customer markets and the comparative economic advantages of specific regions such as the relative price and availability of various inputs, including labor, capital and raw materials and the relative friendliness of various political regimes. Headquarters can be anywhere or everywhere and the country of incorporation will depend on factors such as local tax policy and the availability of a supportive legal system. What all of this means to our political and social institutions is best left to others to decipher. What it means to us is that over the next fifteen years we will witness a pervasive wave of cross-border M&A. In industry after industry it will no longer be sufficient to be the leader in a local market, country or even region. Success will require global presence and global presence requires consolidation.
At Focus LLC we are witnessing the early stirrings of this trend today in our own practice. Over the past year and a half approximately half of our closed transactions involved a non-U. S. buyer from countries as diverse as
Length: This interview is about 21 minutes.
Categories: Intermediaries, Industry Sectors, Strategic Buyers, Private Equity, Business Sale, Business Acquisition, Audio
Tags: acquisitions, Business Sale, cross border M&A, M&A, mergers, mergers and acquisitions, multinationals, Private Equity, transnational corporations
Stephen Frey - Noted Author and Private Equity Dealmaker
Posted on November 30, 2007
If you spend much time frequenting airport bookshops (and if you’re reading this you probably do) you’re familiar with
Steve Frey, who pioneered the “financial thriller” and is still the leading author in that genre. With such titles as The Vulture Fund, Shadow Account and The Chairman, Steve shares with us a world of intrigue and adventure in the world of high finance that we can only dream about in our everyday world. This year Steve
has been particularly prolific with two new titles, The Successor, which carries forward the saga of fictional private equity titan, Christian Gillette, Chairman of Everest Capital, and The Fourth Order, which introduces Steve’s financial universe to a different kind of intrigue and danger in the clandestine world of Washington, DC.
In this interview Steve tells us how he transcended the sometimes mundane world of investment banking to become a world renowned author. He also shares with us insight into his “day job” as a Managing Director of the private equity firm, Albion Investors of New York City and 
Richmond, VA. Albion focuses on what Steve describes as “MicroCap” deals, which I frequently describe as “people sized companies”. As an experienced dealmaker Steve shares his advice for business owners who are considering the sale of their businesses.
Steve is a Wahoo, having graduated from my alma mater, the University of Virginia at Charlottesville, with both an undergraduate degree and an MBA from the Darden School.
Click Here
Length: This interview is about 22 minutes.
Categories: Legal Issues, Private Equity, Negotiation, Business Acquisition, Business Sale, Audio
Tags: acquisitions, Albion Investors, Business Sale, financial thriller, M&A, mergers, mergers and acquisitions, Podcasting, Private Equity, Stephen Frey, Steve Frey, Valuations
Mark Jones - 2008 ACG Intergrowth Chairman
Posted on November 4, 2007
Mark Jones is one of the most visible personalities in the middle market M&A community. In 2008 Mark will chair Intergrowth 2008, the national annual meeting of the Association for Corporate Growth. Intergrowth 2008 is expected to attract over 2000 attendees, including private equity firms, strategic buyers, intermediaries and other professionals.
In this interview Mark gives us a preview of Intergrowth 2008. He also provides a glimpse into his world as a partner in River Associates Investments, LLC, one of the leading private equity groups focused on the lower middle market. Mark shares with us some very valuable insights into what makes a company attractive to a private equity buyer and advice to business owners considering the sale of their business.
Length: This audio interview is about 41 minutes.
Categories: Private Equity, Business Acquisition, Business Sale, Audio
Tags: acquisitions, Association for Corporate Growth, Business Sale, M&A, mergers, mergers and acquisitions, Private Equity, River Associates
Welcome to Mergers.com DealCast
Posted on September 11, 2007
In this interview, I’m interviewed by Phil Leigh of Inside Digital Media about my plans for Mergers.com. We discuss a number of points including my educational background and experience, which encompasses thirty years of focus on corporate finance for middle market companies. We address the process of finding buyers for companies that want to sell, as well as other exit strategies. Phil also questions me about the podcasts that I’ll be doing here with thought leaders in the M & A field, including Private Equity investors, lawyers, accountants, and various intermediaries. Click on the Play button above to hear the 22 minute interview.
Categories: Private Equity, Valuation, Negotiation, Business Sale, Audio
Tags: acquisitions, Business Sale, M&A, mergers, mergers and acquisitions, Podcasting, Private Equity, Valuations
