Kanvic’s corporate finance experts support executives in making the right investment decisions, raising finance, and turning around under-performing businesses.
Mergers & Acquisitions are a vehicle to advance the ambitions of a business. From fast-tracking growth to entering new markets, M&A serves a number of purposes for business leaders. Kanvic advises clients throughout this process, from formulating the M&A strategy, to conducting the due diligence, and supporting the post-merger integration.
At each step we combine a deep understanding of strategy, finance and industry to ensure that an acquisition delivers lasting value to our clients.
Mergers & Acquisitions Strategy
Successful M&A requires a clearly articulated strategy. A strategic acquirer is one who looks at how an acquisition can help them win in their market place.
We work with buyers to conceive acquisition strategies that create more value by identifying the right candidates for acquisition, setting the appropriate price range and building the internal capabilities to secure deals before competing bidders.
Target Identification & Screening
One of the goals of an acquisition strategy is to identify potential target companies and screen them according to clearly defined acquisition criteria.
We help clients define these criteria and bring discipline and focus to the target search process. We also support our clients in scanning the market, building a pipeline of targets and prioritising them according to their fit and availability.
Strategic Due Diligence
Due diligence is when the real substance of a company is separated from the spin.
Kanvic takes a thorough and investigative approach to each stage of the due diligence process to ensure the critical questions are asked and answered.
We take a strategic view of the target’s financial, commercial and operational status and provide an in-depth understanding of the target company’s strategic position in its industry.
Furthermore, working closely with our legal and tax partners, Kanvic ensures that any potential risks and liabilities come to the fore.
Arriving at an appropriate valuation of a target company requires a deep understanding of the value drivers of a business. We help our clients identify these value drivers and model their impact on the future performance of the business. Our deep expertise in finance and strategy enables us to choose the right valuation method and to derive our estimate from relevant comparables and realistic assumptions.
Deal Structuring and Financing
The structure of a deal is critical in ensuring a successful outcome for an acquiring company. Kanvic advises clients on the optimal payment terms and the effective use of earn-out clauses. Where a deal requires external financing, we advise on the right mix of debt and equity and supports the client through the financing process.
In any deal the final negotiation makes or breaks its success. We stand alongside our clients throughout the negotiation process to ensure the right decisions are made at every step.
We start with developing the negotiation strategy which clarifies our clients’ expectations and defines the negotiable and non-negotiable terms.
As we progress through the negotiations we help our clients confidently explain their position through clarification and analysis whenever required. We also advise on the appropriate level of disclosure at key junctures.
Should the negotiations reach a stalemate, we create viable options for conflict resolution between the parties.
Realising the value of a merger or acquisition requires seamless integration of the new business. We help our clients focus on the post-deal priorities by developing a clear integration action plan in advance of finalising the deal. Once the acquisition is finalised, Kanvic supports our clients in implementing organisational changes in the newly combined business.
Alliances and Joint Ventures
An Alliance or Joint Venture can be an effective way of leveraging the capacities of two independent companies for a specific market or business, or to gain access to a particular technology.
Kanvic advises its clients on the most suitable form of partnership. We then assist them in identifying appropriate partners, conducting due diligence and framing the terms of agreement.
Kanvic helps businesses meet their growth ambitions by assessing their financing requirements and securing access to funds.
Defining growth aspirations
Exploiting growth opportunities often requires substantial investment. Where internal accruals are not sufficient to fund expansion, Kanvic can help in securing external finance for growth. We start the process by defining the aspirations of the client in terms of the market space they want to grow in and the level of growth they are looking to achieve.
Building a robust business plan
On the basis of these aspirations, Kanvic prepares an implementable business plan for the finance to be raised. This assesses the feasibility of the proposed project through a due diligence of the client and a strategic analysis of the industry.
Deciding on the right financing
Having established a sound basis for raising finance, Kanvic advises on whether it is preferable to raise debt or equity and what type of lender or investor would be appropriate.
Where required we support our clients in securing Private Equity through our strong network of investors and deep understanding of their expectations and requirements.
We help companies make the right calls on investment decisions by evaluating the full range of options based on returns and risks.
Developing and evaluating options
Making the right call on major decisions about internal capital expenditure is crucial to achieving profitable returns. This can relate to investments for expansion, improvement or replacement. Kanvic helps clients develop a range of alternative options, forecast the return on invested capital, and weigh up the pros and cons of each option.
Conducting a strategic assessment
If investments are related to improving quality or expanding production capacity, our forecasts include a strategic assessment of trends in supply and demand. This ensures that projects are aligned with the market needs and that the planned investment improves the client’s market position.
Advising on the right financing
Having decided on the path forward we advise our clients on the most appropriate form of financing to fund the investment.
Businesses get into financial distress when their debts and other liabilities have reached alarming levels and their cash flows do not allow them to meet repayments. Kanvic provides immediate intervention to stabilise the situation before setting the business on the path to long-term recovery.
Stemming the cash drain
Our first objective in restructuring is to stop the bleeding. We conduct a rapid diagnostic of a company's cash flow to identify the points where cash is getting drained from the business and recommend a series of immediate measures to stem the flow.
We then work with our clients to help them re-finance their debt with lending institutions on more favourable terms. We also assess the potential to divest non-core businesses, assets or products to release funds from the existing business.
Another key priority in restructuring is to review the company’s cost structure and explore the possibilities of cost savings in both variable and fixed costs.
Developing a turnaround plan
Once the situation is stabilised we support our clients in developing initiatives and action plans to increase their sales and return their business to a positive cash flow.