DevelopmentCorporate
DevelopmentCorporate
Contents
DevelopmentCorporate
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Make
Manufacturing Planning
Manufacturing Scheduling
Inventory Management
Inbound Logistics
Production Control
Quality Control
Outbound Logistics
Cost Accounting
Supplier Payments
Supplier Performance Mgmt
Warehouse Management
Product Lifecycle Management
Product Data Management
Service
Returns / Exchanges
Warranty Service
Field Service
Loyalty Programs
Bar Coding
RFID
SOA
EDI VAN
CPFR
BPM
CRM
Application Development /
Deployment
EDI - Enterprise-scale
Outsourcing
Data Synchronization - Private
Catalogue
Data Synchronization - GDSN
Data Pool
ERP
Warehouse Management
EAI
Electronic Payments
Web Forms
B2B Integration
Content Management
Systems Infrastructure &
Management
POS - Analytics
Adapters
AS2 Communications
Business Intelligence
Scan-based Trading
Security
= solid growth
= flat to low growth
= flat to declining growth
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Build
Buy
Identify specific products or technologies that your strategic product roadmap requires
Determine timeline when solution has to be available to achieve market share targets
Honestly assess the time, costs, resources, and risks associated with build options
Recognize that buy option may not yield a solution that is 100% match with your
teams vision of the market requirements
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If competitor A buys
acquisition candidate D
before we do, were
screwed
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2. Determine Acquisition
Financing Constraints
Determine the constraints associated
with financial resources to support
acquisitions
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3. Develop Acquisition
Candidate List
Identify the specific public and
private companies that you are
interested in acquiring
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QAD as of 9/10/09
Enterprise Value
Equity Value
Cash
Debt
Enterprise Value
113.3
(40.6)
16.9
89.6
Premium
Price
Shares Out
Market Cap
less cash
plus debt
Total Enterprise Value
plus: Fees & Expenses*
Gross Purchase Price
Standalone Multiples
TEV / LTM EBITDA
TEV / LTM Revenue
EBITDA/Rev
4.9
233.4
4.9
233.4
EBITDA/Rev
46.7
58.4
81.7
0%
20%
33%
3.68
30.8
113.3
(36.6)
16.9
93.6
14.9
108.5
4.42
30.8
136.0
(36.6)
16.9
116.3
14.9
131.2
4.89
30.8
150.7
(36.6)
16.9
131.0
14.9
145.9
19.1x
0.4x
23.7x
0.5x
26.7x
0.6x
22.1x
0.5x
26.8x
0.6x
29.8x
0.6x
2.0x
1.6x
1.1x
2.5x
2.0x
1.4x
2.8x
2.2x
1.6x
1.0
1.9
12.0
14.9
93.4
15.2
93.4
37.8
93.4
52.6
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5. Rate/Rank Acquisitions
How do various acquisition
candidates rank in terms of impact to
business and feasibility of closing
acquisition?
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Strategic Matrix
Exit Impact
$500M+
Company A
Company D
Company G
Company C
Acquirability
$250M+
<10X
RR EBITDA
4-6X
RR EBITDA
1-2X
RR EBITDA
Company E
Company B
Company F
$0M
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Whats Next
This is the first in a series of presentations on Merger & Acquisition basics.
The remaining posts in this series will cover:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
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DevelopmentCorporate
DevelopmentCorporate is a strategic corporate development
advisory firm for enterprise and mid-market technology
companies. We assist management teams, board of
directors, and investors in updating their merger, acquisition,
and divestiture strategies and then we provide tactical
support for the implementation of those strategies. We
also provide support for strategic initiatives such market
assessments, competitive intelligence updates,
product/service portfolio analysis, etc. Finally, we have
significant experience in guiding large scale organizations
through corporate restructurings to either take advantage
of new market opportunities or respond to changes in
market conditions.
www.developmentcorporate.com
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