BUSINESS MERGER

Has an opportunity arisen for your business to merge with another? Or do you want to actively pursue a merger as a route to grow your business? Our business merger advisory service and M&A experts give you the best chance of making your merger a successful one.

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TRUSTED BY businesses across the UK

WHAT IS A BUSINESS MERGER?

A merger is a transaction where two or more businesses are bought together to form a new legal entity. Importantly, all or the majority of the shareholders of the individual businesses undergoing the merger become shareholders in the new legal entity. This co-ownership brings with it specific transactional challenges which do not feature in a traditional acquisition of one entity by another.

Mergers do come with risk if poorly handled which can have a significant impact on both businesses. For a merger to be successful, the merging companies and their shareholders require similar values, a shared purpose, aligned cultures and goals.

WHO DO WE WORK WITH?

We work with SMEs that have the ambition to grow by merging with another business.

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BUSINESS MERGERS - HOW TO GET IT WRONG

A Harvard Business Review study suggests that 70% to 90% of mergers end up in failure*. And that is not a surprising fact since bringing two organisations together brings added complexity in this type of transaction.

Typical mistakes that organisations frequently make when attempting a business merger include:

  • Failure to define strategic goals of the combined business ahead of the merger;
  • Overestimating the synergies between the merging organisations;
  • Insufficient due diligence resulting in the acquisition of unexpected risks;
  • A lack of cultural fit leading to employee performance issues and lower levels of customer service;
  • Taking an unstructured approach to assessing the market thus failing to find the most suitable merger targets;
  • Poor communications to employees and customers resulting in apathy and mistrust;
  • Mis-aligned management teams with differing opinions on the direction of the new organisation;
  • Lack of post transaction integration plan to best protect cultural values and employee performance.

*Source: M&A: The one thing you need to get right; Roger L Turpin, Harvard Business Review June 2016

BUSINESS MERGERS - HOW TO DO IT RIGHT

To successfully merge with another business, your M&A strategy needs to achieve these key objectives:

  1. Clearly define your purpose, vision and values and take a structured approach to matching those criteria to with potential merger targets;
  2. Develop a professional approach strategy to deliver the conversations you need with potential merger companies;
  3. Develop a robust internal and external PR plan to ensure all stakeholders are communicated the right information at the right time;
  4. Make sure you have a well-defined process from offer to completion that ensures risks are identified and mitigated;
  5. Develop a robust post-merger integration plan that protects value.

BUSINESS MERGER ADVICE & SERVICES

By using our business merger advisory service, our M&A experts add value by ensuring rigour in your merger strategy and executing the transaction to a successful completion. Working collaboratively with our M&A advisors will ensure that you identify the right organisation to merge with, negotiate and secure the deal, protect confidentiality and manage associated risks. This is what our advisory service offers:

INITIATING A MERGER

We can help you initiate conversations if a merger appears to be attractive to move your business forward. Mergers are not usually initiated through an active search or unsolicited approach. More commonly, businesses with a close working association will discuss a merger if the combination of the businesses makes commercial sense.

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WE WILL MANAGE THE TRANSACTION

We will manage the deal completion process ensuring all parties report and deliver on time to make the merger happen. No doubt every process will throw up unexpected challenges and we will be on hand to help you through these.

ADDITIONAL BENEFITS OF USING SHAW & CO

Showing you how

Merging with another business is complex and both organisations need confidence to close a deal. We use our experience to your benefit to gain buy-in from the organisation you wish to merge with.

Circuit Breaker

A merger can involve intense negotiations between shareholders. Having a third party assist in the negotiations ensures difficult conversations can be handled whilst relationships are protected.

Foresight

We have completed numerous mergers and can guide you around the pitfalls before you get there. Ensuring that a merger is right for both organisations is critical before investing months in a process.

RELATED AREAS OF EXPERTISE

FAQS

Do you accept non-UK clients?

No - We work exclusively with UK-based SMEs and small cap PLCs. However, our clients often have international activities and we regularly transact with overseas buyers and investors or arrange overseas acquisitions on behalf of our UK clients.

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What sort of businesses can you help complete a merger?

We work with businesses with EBITDA of £1m and above.

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How do you get paid?

When supporting mergers and acquisitions (including MBIs and MBOs) our fees are based on time at our prevailing rate cards. We do not work contingently when buying a business.

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Do you act contingently?

No, we do not act contingently when buying a business. We believe that continent fee arrangements when supporting the acquisition of a business lead to a conflict of interest between advisor and client.

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Are you sector specialists?

We have specific sector knowledge derived from many years of collective deal making experience. However, we pride ourselves on the diversity of sectors we work with which challenges us to think creatively. This creative and challenging approach brings huge value to our clients when helping them to build robust business cases.

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When Shaw & Co is involved, will I lose control over the process?

Certainly not! Our aim is to become part of your extended team keeping you up to date with all developments. All decisions are yours to make. Our aim is to make those decisions easier.

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What sort of service experience can I expect if I instruct Shaw & Co?

We take all of our clients through a carefully crafted journey. Firstly, to ensure that we are a great match for each other and once engaged, to ensure we deliver exceptional client service that exceeds expectations.

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What are the signs of a good business to merge with?

A merger results in a business where the combined senior management teams need to be able to work together very closely. If the businesses already have a very close working relationship before the merger it is a good sign that the deal will be successful. In addition, alignment of vision and values is even more important in a merger as one party is not ultimately in control of driving change in the other.

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What are the most important things to be aware of when merging with another business?

For many owners the most important thing to be aware of is a significant change in the way that the business is run. Following a merger there will be exciting opportunities to leverage the newly created scale, however decision making will now be multi-dimensional, and an owner may need to compromise more than they have done so in the past.

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Why should I use Shaw & Co to help me merge with another business?

We have extensive experience in helping businesses merge. We understand the key drivers to making a merger successful. We can bring together our expertise to make your merger happen.

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What’s the difference between a merger and an acquisition?

An acquisition envisages that one party purchases control of the other. The shareholders of the acquired business receive consideration for their business in cash, loan notes or some shares. In an acquisition the shareholders of the acquired business are normally exiting or starting the process of exiting. In a merger consideration is normally ‘paper based’ meaning shares are exchanged for shares and most or all shareholders remain invested in and associated with the businesses.

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LEARN MORE ABOUT SHAW & CO

Why Shaw & Co

WE MAKE DEALS HAPPEN

Our highly talented people are creative, innovative and thrive when faced with a deal-making challenge. It's no surprise that we make deals happen and turn your ambition into a greater outcome.

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Fees & charges

COMPLETELY TRANSPARENT & ALIGNed With your GOALs

Our objective is to ensure that our fee more than pays for itself from the value we create for you and your business.

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We put you first

One of our six promises is to do the right thing and put your interests before ours. We work harder to achieve the best deal for you and your business.

"At every step of the journey, through the build up to our sale, and in the subsequent acquisition by Unilever, Shaw & Co worked with us to protect and champion Pukka’s values and mission. They have helped us find the right home in Unilever, and to create an exciting future for Pukka Herbs."

Tim Westwell, Co-Founder & CEO at Pukka Herbs

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