Mergers & Acquisitions

In Central America, mergers and acquisitions are terms that have become popular in recent years, also referred to as M&A. The term refers to the practice of business groups to consolidating with the strategic objective of achieving inorganic growth. A merger involves the formation of a body of common interest by integrating the two groups into one common entity. An acquisition consists of a group buying a controlling stake – up to a 100% – of the assets or equity of another company.

Due to the similar nature of this process, minority investments and capital raises are often referred to as Merger and Acquisition operations as well.

A key step in evaluating different transactions is to understand and differentiate between a strategic buyer and a financial buyer.

Strategic Buyer vs. Financial Buyer

A financial investors’ key objective is to invest money in order to produce a high yield under a given risk tolerance. The financial investor/buyer usually goes into an investment with the end objective of selling the position within a predefined timeframe at a gain. Within the category of financial buyers come individuals, families, and business groups engaged primarily in this activity – e.g. private equity funds, venture capital investors and other such investment funds.

A strategic buyer has the fundamental objective of creating shareholder value by acquiring or merging with another company. They invest in operations that offer strategic value to their own enterprises. Strategic value can be realized in several ways, for example, gaining a geographical advantage, penetrating a new market, strengthening the position in an existing market, diversifying the product portfolio, etc. There are also opportunistic buyers who buy a weak competitor or the division of a company seeking to refocus on its core business.

On the seller’s side, stepping into these processes may be predicated on various motivations. For example, while some entrepreneurs may want to sell part – or all – of their shares to generate liquidity and diversify personal asset portfolios, others may be looking to grow their business or may have identified a need to attract a stronger partner that present a strategic fit.

“Typical” Processes

No two companies in the world are alike. Similarly, each M&A process follows its own course. Nonetheless, each purchase or sale transaction follows a general framework, with similar key steps and milestones.

Each transaction process could be summarized – roughly – with the following diagram:

In both buy-side and sell-side mandates, the scope of our transactional services is tailored to the needs of the project and may include one or more of the following services:

Financial Advisory

Financial Valuation and Fairness Opinion
Financial Feasibility Assessment
Strategic Assessment of Asset Portfolio
Evaluation of Investment / Divestiture Opportunities

Sell-Side Advisory:

Evaluation of Bids and Proposals
Preparation of Presentation Materials
Identification and contact of candidates, strategic or financial
Negotiation of Partnership, Sale or Acquisition Structures
Management of the Due Diligence Process

Buy-Side Advisory:

Identification and contact Candidates
Financial Analysis and Company Evaluation
Definition of letter of intent – Proposed Value and Structure
Negotiation of key deal terms
Management of the Due Diligence Process

Buy-Side Advisory

We advise regional and international companies in evaluating strategic acquisitions in a variety of industries and sectors throughout Central America.

Let us worry about it

Asesores en Finanzas manages the gritty details of mergers and acquisitions in order to facilitate the important decision making process for our clients. We manage the complexity of the process and execute the detailed analysis, presenting to our clients the relevant and organized information that is needed for the “big picture” decisions.

We take care of the complexity of the process to allow for intelligent and informed decisions

We provide personalized services tailored to the needs of each project and each client:

Management of M&A Processes

Initial point of contact with the “Target” and evaluation of strategic alignment.
Financial analysis and valuation.
Identification and quantification of potential synergies.
Negotiation of deal terms.
Management and coordination of due-diligence process.

Target Identification:

Define target profile and criteria as well as strategic objectives; set up an objective framework to effectively assess each individual target.
Market survey and identification of “Targets” using agreed upon criteria.
Contact and dialogue with potential targets.

Seller-Side Advisory

We advise family groups, entrepreneurs and managers of regional companies in evaluating a partial or total sale of companies or business units in a variety of industries and sectors. We leverage our knowledge and experience to manage sales processes in an efficient, orderly and confidential fashion – always keeping in mind the priorities and interests of our clients.

We specialize in managing merger and acquisition processes. Every company is unique and every industry has its own unique set of circumstances; we work closely with our clients to determine how, when, and to whom we submit the these opportunities for optimal results.

Let us worry about it.

Asesores en Finanzas manages the gritty details of mergers and acquisitions in order to facilitate the important decision making process for our clients. We manage the complexity of the process and execute the detailed analysis, presenting to our clients relevant and organized information that is crucial for the “big picture” decisions.

We handle the complexity of the transaction, allowing owners make informed decisions efficiently.

Asesores en Finanzas provides tailored advisory for the needs of each project and each client. Some of the value-added services that we bring to the table:

Preliminary preparation

Financial analysis and valuation.
Managing internal review processes to identify and correct possible contingencies and risks.
Preparation of marketing materials.

Management of M&A Processes

Initial point of contact with the “Target” and evaluation of strategic alignment.
Identification and quantification of potential synergies.
Negotiation of general terms of a possible transaction.
Management and coordination of Due Diligence process.

Having us manage the transactional process brings economic and strategic benefits for our clients:

Increase comfort zone – We maintain high standards of confidentiality with counter parties in regards to our client’s sensitive information, thus minimizing risks.
Streamlining the process – We guide our clients and counterparts to achieve a win-win agreement, streamlining the process and overcoming obstacles.
Facilitate negotiations – We act as intermediaries between decision makers that can translate ideas and key negotiating points to counter parties and receive constructive feedback without affecting the interests of players on both sides of the table.
Contacts – With over 20 years experience in investment banking in the regional market and as partners in Global M & A Partners, we offer a wide network of personal and professional relationships with potential investors, executives, companies and others that are active in the M&A marketplace.

Capital Raising

We leverage our network of contacts around the world to capture and attract capital investment to our client’s businesses, whether they are start-ups or established companies.

We focus on the “smart money” – capital that will enable our clients grow to new heights together with partners that bring relevant experience and a proven track record to the table.