Strategic Mergers and acquisitionsEvery business owner, at some point of time, has to answer the below critical questions:
- How to scale up a small business to a big one? or,
- How to grow the existing one at an accelerated pace into a position of dominance?
Every growing mergers and acquisition companies with surplus funds may look at expansion via an inorganic or organic route. Alternatively, backward or forward integration of the product lines can bring significant value to the organisation. Each growth strategy comes with its own risk and rewards. Mergers and acquisition companies that grow inorganically, can gain access to new markets, improved revenue streams and better technology, through successful mergers and acquisitions companies, but on the flip side the challenges of size-management & culture-blending need to be addressed too. Organically growing, on the other hand is more like gulping what can be chewed and that requires time and patience to nurture, flipside being the market and competition, not providing the comfort of time.
To make such critical decision Cashcow CFOs provide you with best insights and advisory. Our market presence & regular interaction within our strong network makes us continuously aware of unique opportunities that arise, we ascertain the value proposition basis SWOT, using available data.
Current health check-up
Cashcow’s expert approach is to analyse the current financial health and prospects of the ‘opportunity’ though various ratio’s run over a proprietary score card. The report of the same, points to the current weakness and strengths. Understanding the value proposition that amalgamation would bring in the current market is the deal maker.
Long term Forecast & Budgeting
To evaluate opportunities and growth plans, it is necessary to prepare forecasts and budgets. These help us understand the business better and provide a stronger basis for deciding the strategy of the merger and acquisition companies to achieve its goals. Cashcow consulting provides the management team with valuable reports that act as input for product pricing, finance requirement for project execution and necessary capacity utilisation for break even. The team has done Techno Economic Viability (TEV) & Valuation for numerous mergers and acquisition companies and that forms the backbone for recommendations.
Raising finance for Acquisition
Size of the project determines whether existing reserves are sufficient or the methodology for raising term debt gets defined. Cashcow Consulting is equipped with a professional debt raising team with almost 25 years of experience amongst them. The team decides various modes of raising finance either through domestic or foreign currency based term loans or External Commercial Borrowing (ECB) from abroad, or through part cash and part shares swap. Basis fund flow analysis and long term forecasting the required structuring of the debt is undertaken to ensure better risk management for repayment. Term debt is always accompanied by enhancement in working capital.
Read more about working capital finance here.