SERVICESMergers & Acquisitions
Silverwood Partners provides comprehensive mergers & acquisitions transaction execution capabilities, including:
Corporate Sale and Divestiture Advice
Silverwood Partners views the decision to sell a company as a process that involves planning, management, and preparation to obtain the best possible price and terms in a transaction. The reasons for initiating a sale process vary but are typically strategic in nature and may include a need for capital, gaining access to complementary technologies, achieving marketing leverage through an established brand name, or gaining access to improved sales, service, and distribution channels.
Each sale or merger presents a unique set of challenges that can only be overcome through extensive transaction experience and deep sector knowledge. Silverwood's senior professionals are all seasoned investment bankers with extensive experience in implementing a disciplined sale process that includes gaining a thorough understanding of the client, the competitive landscape in which it operates, its culture, and potential. With Silverwood's detailed industry knowledge all such considerations are taken into account to optimally position a client's business with potential strategic partners.
Silverwood's objective is to maximize the sale price by identifying and working with buyers who are most likely to pay a premium price. From the tactical perspective, Silverwood uses its findings and the client's preferences to develop a recommended pricing strategy and procedures for the sale. Ultimately, the selected approach may be a negotiated sale with the highest potential buyer, a limited auction, or a wide auction. Regardless of approach, an important aspect of any sale process is to create competition among buyers to maximize the sale price and optimize transaction terms.
In preparation for the sale, Silverwood analyzes the business and its competitive profile to determine the most logical buyers based on the strategic fit and business rationale for each potential acquiror. In addition, Silverwood develops an estimated valuation range for the business based on its likely performance under the ownership and management of the highest-potential strategic buyers.
The principal aspects of the sale process are: research, identify, screen, prioritize, and contact prospective buyers for the business.
- Prepare a comprehensive information memorandum that includes financial, qualitative, industry, and competitive information, and that highlights the investment opportunity and its strategic and financial value to prospective purchasers.
- Distribute the information memorandum to selected buyers and manage the various requests for additional information, respond to questions, and coordinate visits to facilities and meetings with management.
- Maintain a competitive environment by moving multiple potential buyers forward simultaneously, carefully managing due diligence and the data room, and assisting buyers in preparing initial offers or letters of intent.
- Evaluate alternative offers, including any financing contingencies, and assist in negotiating the terms, conditions, structure, and pricing of a transaction to best achieve the seller's objectives. At a client's request, Silverwood will serve as lead negotiator.
- Provide all supervision required through the contract stage and assist with all matters that pertain to closing with the goal of maintaining momentum through the successful closure of a transaction.
Corporate Acquisition Advice
Silverwood's corporate acquisition advisory services range from assisting clients with situations where the counterparts are already discussing a transaction to assisting clients in locating suitable acquisition candidates and with related transactions.
Silverwood utilizes its in-depth sector knowledge and transaction experience to assist clients with a broad range of acquisition situations - from fill-in technology or product acquisitions to larger merger-of-equals transactions. In each case, Silverwood responds to a need for an advisor with a deep understanding of the industry sector concerned, and proven execution capabilities accumulated by the firm's principals over decades of transaction experience. The firm's professionals understand negotiating tactics, transaction structuring, legal and business due diligence, financing considerations, board level decision making considerations, and the many requirements associated with working as part of a multi-disciplinary transaction team.
Silverwood is typically retained to provide a highly informed third party perspective on transactions of all sizes and, in many cases, to render a fairness opinion in connection with a transaction.
As a result of Silverwood's sector focus, extensive industry contacts and transaction expertise, the firm is retained by clients to assist in locating suitable acquisition candidates and in executing related transactions. A phased approach is used for each Silverwood acquisition engagement:
- Definition of Acquisition CriteriaA generic profile of a target company is formed and related to those in the chosen market.
- Conducting the Search ProcessSilverwood searches the firm's industry databases to identify companies matching the target profile, and provide brief summaries on a comprehensive list of target candidates.
- Analysis of Target CompaniesA short-list of high potential companies is examined in greater depth and a more detailed profile is developed for each company that reviews key products, markets, clients, accounts, and key personnel.
Introduction and Negotiation
Silverwood approaches target companies on a confidential third party basis and, if appropriate, makes a formal introduction. Silverwood then provides direct assistance during discussions and transaction negotiations.
Due Diligence and Conclusion
Silverwood provides support and guidance throughout the due diligence and definitive documentation process in working toward a successful transaction closing.
Strategic Alternative Assessment
The business environment is constantly changing. Change can happen over a relatively long period of time, or it can be abrupt or event-driven. Whatever the precipitating factor; capital, competition, or technology, a business may have a need to evaluate its strategic alternatives and determine an appropriate course of action for the maximization of shareholder value.
A typical engagement involves Silverwood working with a client's senior management and Board to:
- Develop a detailed understanding of the strategic business units within an organization
- Provide a competitive analysis for each business unit and the combined company for use in strategic decision making through Silverwood's in-depth industry knowledge and a client's industry perspective
- Determine the optimal strategy for maximizing the value of each business unit, i.e., retain the business, sell the business, merge the business with another similarly sized operation, or spin-out the business by selling a minority stake to an institutional investor
- Drive the decision making process forward into transaction execution
Silverwood's principals have extensive experience in assisting clients with strategic alternative assessments and in implementing recommended action plans.
Strategic Pro Forma ® Analysis
Investment banks frequently analyze the financial effects of combining two businesses. Of equal importance are the strategic and qualitative issues associated with merging two companies. Such issues are more difficult to assess as a detailed industry understanding is required. Silverwood has developed a proprietary methodology for comprehensively reviewing the strategic, qualitative, and quantitative aspects of a proposed business combination: the Strategic Pro Forma®.
As part of a Strategic Pro Forma®, Silverwood uses its in-depth sector knowledge and research resources to review and analyze issues that affect each company separately pre-transaction and the combined business post-transaction, such as:
- Fundamental industry trends
- Product lines and service offerings
- Manufacturing and service delivery resources
- Sales force coverage by product, geography, or channel
- Distributor relationships
- Brand, marketing, and business development resources
- Service and support resources
- Customer or segment coverage
- General and administrative costs
- Income statement, balance sheet, and cash flow statement
- Capital structure
- Earnings per share and valuation implications
- Stockholder profile
Silverwood's Strategic Pro Forma® is used by corporate senior management and Boards as an important tool in the decision making process that is an integral part of each merger or acquisition transaction.
Strategic Partner Identification
A possible outcome of a strategic assessment is a determination that all or part of a business would benefit from the scale of a larger entity. Factors that drive such a decision may include a need for capital, gaining access to complementary technologies, achieving marketing leverage through an established brand name, or gaining access to improved sales, service, and distribution channels.
A consistent aspect of Silverwood's strategic execution is the creation of multiple transaction opportunities such that a client has alternatives and the strongest possible negotiating position when structuring a transaction. Silverwood first positions a business as an attractive partner and then accesses extensive industry relationships to present opportunities that create long-term value for the firm's clients. Through the firm's research initiatives and active transaction flow, Silverwood is in frequent contact with corporate decision makers who are actively pursuing strategic investments, mergers, and acquisitions.
"The Silverwood Partners team ran a comprehensive process and were thorough in exploring M&A possibilities for Caringo. DataCore is a great strategic partner for the business."
Chief Executive Officer
“The Silverwood team was great to work with and achieved an outstanding result. Silverwood drove the sale process, brought a wide range of bidders forward for consideration, and provided the investors and Board with multiple compelling alternatives. Ultimately, Silverwood provided invaluable counsel as … joined with the ideal strategic partner … Kudos for a job well done. I look forward to working with Jonathan and the Silverwood team again in the future.”
Founder & CEO
Livestreaming Camera Company
“We are pleased to have found a great partner for the Brands Within Reach business as NewAge moves in a different strategic direction with ARIIX and our direct selling/e-commerce initiatives. Silverwood Partners ran a comprehensive process and delivered a range of alternatives for review – we appreciate the industry expertise and guidance of the Silverwood team.”
Chief Executive Officer
"Silverwood Partners led us to a successful transaction within a short period of time. They identified a broad range of strategic players within the emerging natural and organic space as well as relevant financial players. They were responsive to our short lead times and provided value added support to extend our limited resources when we needed it. They were great partners, making the process easy as well as enjoyable. We intend to use them again as we expand our business model in the future. "
Chief Executive Officer
Healthy Mama Holdings LLC
“Silverwood has long been the gold standard for understanding the emerging food and beverage industry, their innovators and the consumers they serve. Their consumer investment banking team has played the critical role in partnering with great CPG brands at the right time and in the right way, taking them to greater success.”
Chief Executive Officer
“The team was great to work with. The process produced a range of alternatives, and we closed with an acquirer that has the resources to drive our business into the next phase.”
Chief Executive Officer
“Silverwood Partners went above and beyond as our investment banker and was highly responsive in guiding us through a fast-changing market environment. The firm’s deep network of industry advisors and strategic partners provided us with a really strong look at the options available, and ultimately resulted in a perfect transaction counterpart for us. Silverwood was disciplined and structured yet also creative in identifying a range of alternatives involving industry-leading strategic and financial players. Kudos on a job well done, and thanks to the Silverwood team.”
Founder & CEO