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Exit and Growth Strategies for Middle Market Businesses

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Who Moved My Deal? | Why Selling Your Company isn’t a DIY Project [Part 1]

By Daniel Sirvent | Apr 09, 2020

While intelligence, creativity and grit are all requisite characteristics of a future surgeon, nothing quite works like experience.

Nearly any medical school resident can handle a surgical procedure under normal circumstances; they’ve studied and memorized the procedures and the most likely risks associated with them. So why do they need an attending surgeon to supervise? Because when things don’t go according to plan, they need someone who’s “been there and done that” who can remain calm and work through the situation to re-stabilize the patient and get them to recovery.

How Business Owners Kill Their Own Deals

Why would an intelligent, creative and gritty business owner who hires a mechanic to repair their car and a plumber to fix their toilet, ever even think about trying to sell what may be their most prized and valuable financial asset all by themselves?

Simply put, they believe they understand the procedure (just find a buyer and stand your ground) and they believe they have the “right stuff” to negotiate a great deal.

Unfortunately, what they’re often lacking is the experience to handle the unexpected turns that come with the territory and often don’t realize their mistakes until it’s too late. Which could mean that at best they’ve missed an opportunity or at the worst, agreed to a deal that’s left them holding the short end of the stick.

So what are some of the most common mistakes that can derail a transaction and/or lower the transaction value in a business sale?

Time vs. Ego – What Kills More Deals?

Years ago, I had a public company CEO as a client who told me “time is the enemy of all deals.” While his intentions were well placed (he didn’t want to be the party that was dragging its feet), I gently and directly let him know that…he was completely wrong. Time is actually an asset that both parties need to protect and manage effectively, but that’s not the same as assuming that every part of the process must be fast. While poor time management carries its own risks, ego is the true enemy of all deals. When either party in a transaction fails to acknowledge the role ego plays, the entire deal is put at risk.  Read more »


M&A Quarterly News In The Healthcare Industry Sector

By Daniel Sirvent | Feb 20, 2020

The report below gives a good overview of the first quarter M&A activity in the Healthcare Industry Sector. There were 189 completed North American-based Healthcare M&A deals in Q4 2019, according to FactSet Research Systems.

A notable middle-market transaction announced in Q4 was Charles River Laboratories International, Inc.’s [NYSE: CRL] acquisition of HemaCare Corporation [OTCMKTS: HEMA] for approximately $380 million in cash. The acquisition expands Charles River’s scientific capabilities in the emerging, high-growth cell therapy sector, creating a comprehensive cell therapy solution that can help developers and manufacturers advance their critical programs from discovery through commercialization.

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M&A Quarterly News In The Aviation, Aerospace and Defense Industry Sector

By Daniel Sirvent | Jan 14, 2020

The report below gives a good overview of the fourth quarter M&A activity in the Aviation, Aerospace and Defense Industry Sector. M&A activity for North American based target companies in the Aerospace and Defense sector for Q3 2019 included 13 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions in the sector was announced in July when Kellstrom Defense Aerospace, Inc., a subsidiary of Kellstrom Defense, Inc., ultimately owned by The Merex Group, acquired Tavco, Inc. for an undisclosed amount. The transaction would enhance Kellstrom Defense Aerospace’s customer service capabilities. Tavco manufactures and distributes defense aircrafts. The company is headquartered in Chatsworth, CA.

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M&A Quarterly News In The Healthcare Industry Sector

By Daniel Sirvent | Nov 08, 2019

The report below gives a good overview of the fourth quarter M&A activity in the Healthcare Industry Sector. M&A activity for North American based target companies in the Healthcare sector for Q3 2019 included 168 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions in the sector closed in August when AtriCure, Inc. acquired SentreHEART, Inc., a portfolio company of Pinnacle Ventures LLC, Presidio Management Group Inc, Prospect Venture Partners, Vivo Capital LLC, Deerfield Management Co LP and Decheng Capital LLC, for US$281.4 million in stock and contingent payout with an undisclosed amount in cash. Founded in 2005, SentreHEART is located in Redwood City, California and develops catheter-based solutions.

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M&A Quarterly News In The Healthcare Industry Sector

By Daniel Sirvent | Sep 27, 2019

The report below gives a good overview of the third quarter M&A activity in the Healthcare Industry Sector. Though Healthcare M&A activity moderated in Q2 2019, several substantial transactions held the quarter securely in line with prior trends. M&A activity for North American based target companies in the Healthcare sector for Q2 2019 included 181 closed deals, according to data published by industry data tracker FactSet.

A notable middle market transaction in the sector closed in June when Varian Medical Systems, Inc. acquired Cancer Treatment Services International, Inc., a portfolio company of TPG Growth LLC, for $283 MM in cash. Cancer Treatment Services International develops and operates cancer treatment facilities and is located in Pittsburgh, PA. Varian Medical Systems is headquartered in Palo Alto, CA and uses X-ray energy to develop new technologies to fight cancer. This transaction broadens Varian Medical Systems’ portfolio of cancer treatment service offerings. The acquisition was funded through Varian Medical Systems’ credit facility and cash on hand. The transaction is expected to increase Varian’s earnings per share during fiscal year 2021 and 2022.

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M&A Quarterly News In The Aviation, Aerospace and Defense Industry Sector

By Daniel Sirvent | Sep 16, 2019

The report below gives a good overview of the third quarter M&A activity in the Aviation, Aerospace and Defense Industry Sector. M&A activity for North American based target companies in the Aerospace and Defense sector for Q2 2019 included 13 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions in the sector closed in June when Consolidated Precision Products Corp, a portfolio company of Warburg Pincus LLC, acquired Pacific Cast Technologies, Inc. from ATI Ladish LLC, ultimately owned by Allegheny Technologies, for an undisclosed amount. The acquisition complements Consolidated Precision Products Corp’s aerospace and industrial focused portfolio. Pacific Cast Technologies engages in the production of titanium investment castings used by aerospace and defense OEMs.

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M&A Quarterly News In The Aviation, Aerospace and Defense Industry Sector

By Daniel Sirvent | Jun 17, 2019

The report below gives a good overview of the second quarter M&A activity in the Aviation, Aerospace and Defense Industry Sector. In Q1 2019 the value of global mergers and acquisitions in the Aerospace and Defense sector was $11.0B and the number of M&A deals was 87 (source: Pitchbook).

In a notable deal, Kellstrom Defense, Inc. acquired Williams Aerospace & Manufacturing, Inc., a Spring Valley, CA military aircraft replacement parts manufacturer, for an undisclosed amount in January. The deal was financed with debt from PNC Mezzanine Capital, Barings, and Blue Torch Capital. Chris Celtruda, CEO of Kellstrom Defense, stated the acquisition supports their growth strategy to rapidly integrate the Williams Aerospace & Manufacturing business, while also investing in products and solutions set for military aircraft sustainment.

Read more »


M&A Quarterly News In The Healthcare Industry Sector

By Daniel Sirvent | May 09, 2019

The report below gives a good overview of the second quarter M&A activity in the Healthcare Industry Sector. M&A activity for North American based target companies in the Healthcare sector for Q1 2019 included 156 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions closed in March when Acrotech Biopharma LLC, a subsidiary of Aurobindo Pharma Ltd, acquired the business and assets of 7 Hematology Products from Spectrum Pharmaceuticals, Inc. for $300 million in cash and contingent payout. The acquisition would allow Acrotech Biopharma to expand its product offerings.

Read more »


M&A News In The Healthcare Industry Sector

By Daniel Sirvent | Feb 20, 2019

The report below gives a good overview of the first quarter M&A activity in the Healthcare Industry Sector. M&A activity for North American based target companies in the Healthcare sector for Q4 2018 included 103 closed deals, according to data published by industry data tracker FactSet.

Pharos Capital Group LLC acquired an undisclosed majority stake in Charter Health Care Group LLC for an undisclosed amount. The acquisition helps Pharos Capital Group’s strategy to improve the patient experience and lower the costs of care. Founded in 2006, Charter Health Care Group is located in Covina, California and provides post-acute hospice, transitional care and home health care services throughout San Bernardino, Riverside, Los Angeles and Orange counties.

 Industry Indicators

  • Total U.S. revenue for healthcare and social assistance rose 4.7% in the third quarter of 2018 compared to the previous year.
  • U.S. consumer prices for medical care services, an indicator of profitability for healthcare services, rose 2.6% in December 2018 compared to the same month in 2017.
  • U.S. consumer prices for medical care commodities, an indicator of healthcare costs, decreased 0.5% in December 2018 compared to the same period in 2017.
  • U.S. nondurable goods manufacturers’ shipments of pharmaceuticals and medicines, an indicator of pharmaceuticals production, rose 9.1% year-to-date in October 2018 compared to the same period in 2017.
  • U.S. retail sales for health and personal care stores, a potential measure of consumer spending on pharmaceuticals, increased 3.8% in the first eleven months of 2018 compared to the same period in 2017.

Posted by Daniel Sirvent.

Read the Entire Healthcare 1st Quarter Newsletter Here


M&A Quarterly News In The Aviation, Aerospace and Defense Industry Sector

By Daniel Sirvent | Dec 19, 2018

The report below gives a good overview of the fourth quarter M&A activity in the Aviation, Aerospace and Defense Industry Sector. M&A activity for North American target companies in the Aerospace and Defense sector Q3 2018 included 11 closed deals, according to Factset Research.

One of the notable middle market transactions was announced in September when Boeing acquired Millennium Space Systems, Inc. for an undisclosed amount. Following the transaction, Millennium Space Systems Inc will be rebranded as Millennium Space Systems, A Boeing Company. The acquisition expands Boeing’s satellite and space portfolio, talent and capabilities. Founded in 2001, Millennium Space Systems is located in El Segundo, CA and develops high-performance spacecraft parts. It has approximately 260 employees .

Industry Update
  • US corporate profits, which affect airline traffic and demand for new commercial aircraft, rose 7.7% in the second quarter of 2018 compared to the same period in 2017.
  • US steel mill product prices, an indicator of commodity steel costs for aerospace products, rose 18.1% in September 2018 compared to the same month in 2017.

Posted by Daniel Sirvent.

Read the Entire Aviation, Aerospace & Defense M&A 4th Quarter Newsletter Here