Study of an interesting M&A Deal

Speaking about merger and acquisition we tend to believe that every organisation in the Global market has put up the best practices in their niche markets. But is that really so?  Obviously not. When we talk about all the organisations and paint a complete picture of each of them and their individual roles in the Global market we can see that there are many firms who are still lacking in maintaining the overall practice from their end.

Adding further, we can say that these firms, who need professional assistance in performing vital tasks like determining the sales price, might find all the transactions helpful, as they can teach them how to go with all the activities.  Merger and acquisition, as we know are important aspects that are needed to be tended by professional Business Brokers, but the charges they demand becomes an important aspect when it comes to small and medium scale businesses. That’s why it is recommended for them to focus more on the product if they want to sell their business even for recapitalization. One of the most prominent deals this year can be the acquisition of two of the most prominent organisations in the field of technological security by an even stronger organisation that is HEICO.

The deal presented to HEICO can be seen as one of the most prominent transactions, because both TS and ID play an important role in providing surveillance services in the market. So the question arises what exactly is it that made HEICO acquire both Transformational Security and Intelligent Devices?  As we all know that the latter is an Aerospace organisation its interest in organisations that would provide surveillance solutions can seem to be a logical proposition keeping in mind that both these firms are the leading ones in their niche market.

 to answer the question let’s get a better understanding about the entire deal and  draw our own conclusions so that we have a better and closer understanding of each of the forms involved in the transaction.

On that note let’s understand why Transformational Security and Intelligent Devices decided to get into the transaction in the first place. As we earlier discussed, both these companies are an expert in their field they needed and an even bigger organisation that code helps them reach out to their audience. And HEICO proved to be the best buyer for them. If we take a look at both these companies we can see how this deal can prove to be their best decision in the long term. Having an aerospace company to back you up and your services can help you reach out to your customers at an even exponential rate.

HEICO Corporation has primarily been engaged in design, production, and servicing products and services to certain markets of aviation, defence, and medical; but with transformational security (TS) and intelligent devices (ID) they can serve a large group of customers quite easily. and that is equally true for TS and ID. The need for a wider customer base is what makes all the point in any M&A transaction. Whether a firm is looking How to Sell a Company, or if a buying party is looking for business brokers for the right organization to acquire, if the transaction is structured as ‘recapitalization’, both the parties should satisfy this need.

WHAT A SMALL SCALE BUSINESS SHOULD DO?

 As we know for a fact that both Transformational Security and Intelligent Devices have secured their position in the global market, all the other organizations should consider focusing on that one aspect that makes them stand out from the lot. In this case both TS and ID focused on their surveillance solutions. So much was their expertise in their niche market that their dedication alone led them to bag an impressive deal like the one they signed with HEICO Corporation.

For a small business, it’s an important decision to choose the right buyer, because the entire future of the firm is backed only by this decision of theirs. That’s why business brokers help these firms in finding the prospective choice for them. But even the brokers won’t help, if the firm isn’t working hard enough to bag the deal it expects to.

WHY IS IT IMPORTANT NOW?

As we know that in recent times, merger and acquisition have turned out to be the most important practices; all the small and medium scale organizations should understand that it is the right time to focus on their ability to sustain the harsh conditions of the market.

But the most important factor to consider is to create a long-term relationship with the buyer, that’s why, for every selling party it is important to choose a firm that has the ability to maintain a long term relationship. This helps both the firms to stay relevant to each other and to the market where they belong.

WHAT A BUYER SHOULD FOCUS ON?

Even though we already had a brief discussion about this, in earlier paragraphs, it’s just important to take a quick look back at the practices every buyer should exercise when getting into a transaction so that the analogy in the subsequent paragraphs has an overall connection throughout.

Coming back to the practices recommended for buyers, it’s not just confined to hiring best business brokers. Rather, hiring the brokers is among the initial steps. What requires more attention from the brokers is the attention it pays to the entire transaction from the seller’s perspective as well.

If we take a look at the HEICO-TS & ID deal, we can understand how this transaction got executed. The first thing that comes to the mind, is the freedom provided to TS and ID. HEICO’s announcement regarding the fact that it has allowed both the acquired firms to operate freely, proved to be a smart move with an attention to the selling party. This will help all the firs work peacefully under the same roof.

On a concluding note, every transaction brings along an opportunity for all the other firms to learn all the things the transaction consists of. The above discussion provides a similar analogy and an in-depth solution to many queries regarding practices that are needed to be considered by both the parties.

If you are a selling party and have any unanswered queries, you can look up Rocky Mountain Business Advisors, the best Business Brokers in Colorado and many other markets. Give us a call at 303-474-5582 and enjoy our services.