Mergers and Business Acquisitions
At Mission Valley Capital we can provide $1,000,000 to $500,000,000 in M&A Financing.
The two sides of an M&A transaction might have very different analysis when it comes to valuing the business in question. Like many transactions, the seller will try to get the highest price where the buyer might purposely undervalue in order to get the lowest price. An acquisition is the purchase of some portion of one company by another, where a merger represents the incorporation of one company by another. Merger activity has typically coincided with a strong economy and high stock market activity.
Mergers and Acquisitions Terms Defined:
- A target company is the company being acquired.
- The acquiring company is the company acquiring.
- A hostile takeover is when the target company board of directors objects to a takeover offer.
- A friendly takeover is when the target company board of directors approves the offer.
There are many legitimate ways to establish value. The most common method is to look at comparable companies in an industry but there are a variety of other methods. Whether using Comparative Ratios, Replacement Costs or Discounted Cash Flow methods, Mission Valley Capital can help facilitate.
The reasons for Mergers and Acquisitions have variations from one company or group of people to the next. Common motives to merge are a need for additional capital, a need for additional resources, growth opportunities that present themselves both externally and internally and in many cases an opportunity for synergy with another entity. While synergy, growth and an increase in market power are all merger opportunities that create value, there can be other motive at play. You might be following former clients who have gone to the competition for features you can only obtain through the company itself. Maybe there is a technology that would all you to run more efficiently if you had it with your current client base. Maybe there is a tax consideration that would change your taxable status and allow for less strain on capital. Regardless of the reason, Mission Valley Capital can help.
Let our experience be the guiding light for your corporate financing. We conduct an in-depth analysis of the business that is being acquired, so we can then leverage the existing assets of the business to structure the right financing for you. Call to speak with one of the partners today about how the Financing works for Merger and Acquisition Financing.