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MERGERS AND ACQUISITIONS
One of our key activities is to assist clients who wish to establish themselves in foreign markets through merging with, or acquiring local concerns. We provide a range of services related to mergers and acquisitions.
Identifying Targets for Mergers & Acquisitions
SDR conducts preliminary research on companies in the target geographies or sectors. We assess their standing, market share, the health of their operations and their range of services or products. We also make the initial contact with the target companies to assess their interest in a merger or acquisition.
Company Valuation and Financial Modeling
Determining the value of a target company is key for any M&A transaction. SDR assists clients to do this efficiently by developing the necessary financial models to calculate the return on a proposed investment or transaction, the net present value and payback period. We conduct analyses to determine the sensitivity of the financial models to changes in key parameters or assumptions and the effect of different growth projections. SDR can also estimate the local industry average cost of capital related to their specific activities or business.
CONDUCTING NEGOTIATIONS
Once a potential target for a merger or acquisition has been identified, SDR can facilitate or lead the negotiations between our client and the target company. Where required, we can act as the client’s representative in these negotiations.
This is often a challenging period for the seller and in our experience, a great deal of personal attention, empathy, and support may be required. Given our international background and fluency in several languages, we are also very aware of cultural differences and sensitivities, and of the potential for misunderstanding and mistrust. We place emphasis on building relationships and creating mutual understanding to ensure the negotiation process is as smooth and efficient as possible.
IMPLEMENTING DEALS
Due Diligence
Conducting due diligence studies on the financial, trading and legal aspects of a target company is equally an essential part of a merger or acquisition process. SDR assists in having these studies performed, and analyses the studies for their potential impact on the proposed transaction.
Financing the Deal
Through our contacts with local financial institutions and venture capitalists, SDR can assist clients in negotiations to obtain debt-funding of transactions. The impact of debt will be built into the financial models to test the continued viability of a proposed transaction and to determine optimum gearing levels.
Implementation
When agreement is reached on a transaction, SDR assists clients in a number of ways:
– Preparing purchase agreements
– NDA, LOI and SPA
– Preparing documentation to ensure legal compliance
– Company registration
– Preparing a detailed integration plan.
POST-TRANSACTION SUPPORT
Once a new venture has been established, or a company acquired, there is often a need for significant further levels of support. SDR can assist with the following services:
– Preparation of strategic plans
– Drawing up a business plan
– Location of suitable management staff and personnel.
In certain instances, our clients have requested we have board representation during the transition and implementation phases to ensure continuity and the success of the venture.