There is a lot going on in the world of private equity. Competition is increasing. To such an extent that it is becoming increasingly difficult for investors to find valuable opportunities. Which companies are interesting for those investors?
There is a lot going on in the world of private equity. Under pressure from the low returns on low-risk shares and bonds, smart investors are looking for solutions that offer better returns. Or with which you can diversify your portfolios even better and avoid the effects of the volatile market. In short, the demand for private equity investment opportunities is increasing. To such an extent that it exceeds the supply of relevant(!) capital-seeking start-ups, scale-ups or mature companies.
Investing, by the way, is about much more than buying low and selling high. Buying the right company - with fundamental value - at the best price, at the right time ... that is the art. Then you are better off with a team of experts with a solid, preferably international network. Our advisers receive signals about investment opportunities from almost 170 countries where BDO supports companies and organisations. Why limit the search to Belgium when there are also valuable opportunities abroad, right?
On the other hand, many companies are not even aware of their potential, which is attractive to investors. Our experts uncover the possibilities and guide companies or organisations that are looking for extra capital to finance their growth. Because let's face it, complex transactions, such as mergers, sales, acquisitions, divestments ... are real specialists' work. We have those experts in-house. They help to mitigate transaction risks. And to optimise the value of the 'deal'. Always with the win-win story as the objective, of course.
McKinsey & Company research (April 2020) .
shows that in crisis years, fund managers using a dedicated value creation team outperformed those without (18%) by five percentage points in terms of internal rate of return (23%). It is no coincidence that value enhancement is a focal point of our 'Corporate Finance' team.
Value creation works both ways. On the supply side, our experts help strengthen the company's profitability and increase its intrinsic value. On the demand side, we minimise the risks of value loss. An extremely thorough 'acquisition due diligence' exposes all risks related to the 'target' company and the transaction. Quantitatively and qualitatively. Is the 'key management' not on the take? And what impact could that have on a successful integration? What if the company underperforms after the integration? These are just two risks by way of example.
Good to know: in order to support the CFO in his strategic role of contributing to value creation, our experts developed 'The Office of the CFO', a one-stop shop to provide finance managers with a 360° service. In many companies, the CFO often finds that his tools are inadequate because they do not work fast enough, or because they rely on too many different information sources and inconsistent data, or because the available computer power is too weak. In short, the time is ripe to switch to integrated, advanced data and financial management. After all, the CFO of tomorrow will undoubtedly be a 'digital CFO'.
What are you looking for?
Our 'Corporate Finance' team guides you through all steps in the M&A process. From the idea and first contacts, through analysis and valuation, negotiations, letter of intent, due diligence... to closing the transaction. Pragmatic, cost-efficient and with respect for deadlines.
In addition, it is in constant consultation with colleagues who are specialised in adjacent fields, such as taxation , finance, employment law , etc. Bottom line: as an experienced, independent and multidisciplinary team, they understand the opportunities, risks and pitfalls of the transaction and put the agreements of all parties involved clearly on paper. No matter how complex or technical. Use their know-how and experience for
- setting the real objective clearly;
- detecting and analysing pitfalls and risks;
- Conducting the (technically complex) negotiations;
- Performing due diligence;
- the execution of purchase and sale mandates;
- Rolling out all the steps in the private equity process;
- Drafting or evaluating the letter of intent, the sale-purchase agreement, the post-transaction formalities;
- the accompaniment of the integration or change process; < link to https://www.bdo.be/nl-be/diensten/advisory/strategy-and-transformation>
- Searching for interim managers to manage the integration; < linking to https://www.bdo.be/nl-be/diensten/advisory/flexible-resources-interim-management>
More info on the Belgian M&A market can be found in our annual M&A Monitor.
BDO is a partner of the Vlerick Centre for Mergers, Acquisitions, and Buyouts. This unique platform gathers all knowledge and best practices from the M&A field, developed and disseminated through research, training and events.