Merger Acquisitions Advisory Services

    • Merger acquisition means the consolidation of two companies or assets into one
    • Corporate Finance Advisory
    • M&A Transaction Services
    • Valuation & Modelling
    • Infrastructure & Capital Projects Advisory
    • Write to us at accounts@especia.co.in
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We, the Especia, bring our client the combination of financial, commercial and operational insight to every deal.

Whether you are making a merger, acquisition or alliance, in each case we work with the same objective, to make sure you get the maximum return on the deal.

We assist financial and corporate investors in assessing opportunities and advisory services to support them in making effective and timely investment decisions.

What are Transaction Services

Transaction Services are the services which are provided by a third-party firm to help in the transaction during a business deal. One of the examples of transaction services is merger and acquisition.

Stakes are very high, so sound judgement and professional advice are a must and it has a tight timeline. 

Merger and Acquisition meaning

Merger and acquisition mean the consolidation of two companies or assets through various financial transactions including the purchase of assets, consolidation, mergers etc. 

A merger is a combination of two companies or firms which subsequently forms a new legal entity.

When one company takes over another company and a new company is formed, it is called acquisition.

Advantages of merger and acquisition

  1. It helps the business to avail some administrative benefits from the acquirer company.
  2. Helps the business firm to make its significant presence in the new market. 
  3. Helps in introducing the new products in the market with the R&D and market analysis needs.
  4. Offers the best class of products and services in the market for higher customer satisfaction.

Types of Merger & Acquisition

  1. Merger: A merger is an agreement that combines two existing companies to form a new legal entity. Mergers and acquisitions are broadly done to expand their reach, expand into new segments or gain market share. 

There are five major types of mergers conglomerate, congeneric, market extension, horizontal and vertical. It combines two separate companies into a single new company.

  1. Acquisition: Where the acquiring company acquires the firm by obtaining the majority stake in the acquired firm, which does not change the name and organisational structure of the company.

If the acquiring firm buys 50% or more of the target company share, then it effectively gains control of that company. It’s often carried out with the help of investment banks. The acquisition is closely related to mergers and takeovers.

  1. Consolidation: Consolidation is when two or more companies merge to become one company. 

Also known as an amalgamation of companies, often it's associated with mergers and acquisitions. 

It generally happens when several similar businesses and small businesses combine together to form a new large entity.

Combining multiple companies and small businesses into brand new companies is consolidation.

Advantages of Business Consolidation

Combining businesses or business units into large entities generally increases the bottom line of the new company. 

It means it may be able to increase revenue and cut costs, that's because the new entity is more likely to buy more units to satisfy the large customer base.

Business consolidation can result in a larger customer base, greater geographical reach etc. This is true if the new entity formed is more stable, more profitable or has more assets to use as collateral.

Disadvantages of business consolidation

Unemployment created: When two companies integrate doing the same activity, then it might create duplication and over capability within the company, therefore the company might eliminate the underperforming people. Thus, employees may lose their jobs.

The high price of products and services: Merger results in a large market share and also reduces the competition. Companies having less competition in the market leads to an increase in the price of products and services. The consumer has to bear the high price of products and services. 

Diseconomies of scale: Where there is less common between companies and merger and acquisition happens, then it may be difficult to get benefit from synergies. Sometimes, the big company is not able to motivate the employee and achieve the same level of control. Therefore, sometimes merger and acquisition may result in diseconomies of scale.

Sectors of Operation in M&A

  1. Healthcare M&A
  2. Tax Structuring M&A
  3. Aerospace Defense and Government Services (ADG) M&A
  4. Energy M&A
  5. Technology M&A
  6. Industrials M&A
  7. Business Services M&A
  8. Valuation modelling

 

1. Healthcare M&A

Mergers and acquisitions in the healthcare industry have increased significantly in the past few years. 

The Healthcare industry is very unpredictable these days. The aim of mergers and acquisitions is to lower the cost of healthcare and improve the quality of care. 

Mergers and acquisitions also happen when a health system can not operate on its own without the financial support of other companies. 

Key elements regardless of size and type for successful deals:

1. Robust due diligence

2. Quick wins following post-merger integration

3. Long-term strategic and operational improvement

4. Improved pipeline development and portfolio improvements

These elements help in mergers and acquisitions to gain deep knowledge and functional expertise in healthcare.

Mergers and acquisitions in this sector have been valued at $4.32 billion from Jan to June 2021 as compared to $2.02 billion in the last year for the same period.

With the Pharmaceuticals and biotech mergers and acquisitions, healthcare sectors are not left behind. It's been increasing as compared to last year.  

 

It is very essential to know how the deals of merger and acquisition impact the healthcare staff. 

At this time many hospitals and physicians are facing problems of shortage of workplace because of merger and acquisition.

2. Tax Structuring M&A 

The department of tax provides the strategic analysis that guides M&A decisions and structuring. 

Parties in merger and acquisition need to understand the tax implications of the transaction before the deal is closed and have a clear direction to execute the post-merger transaction. The proposed parties need to be confident about the tax implications.

Our tax structuring team helps the buyer and seller to understand the current and future tax options and elaborates the tax efficient structure. 

Tax due diligence helps in identifying the tax risk and tax structuring is to elaborate the structure of tax for acquisition as well as ongoing.

3. Aerospace Defense and Government Services (ADG) M&A

The aerospace, defence, and government services (ADG) industry continuously experience zestful growth. Recently, the aerospace and defence industry merger & acquisitions have changed. 

Currently, aerospace and defence M&A focus on delivering new products and offers expansion into markets instead of focusing only on cost savings. 

Global spending increases on defence and civil aviation. Our team provides you with advice on the basis of knowledge of the industry and experience. 

The team focuses on the challenges faced and the development within the industry, which allows the especia to solve your problems.

4. Energy M&A

Last year there was a low activity deal and many of the companies are turning into mergers and acquisitions to acquire low carbon assets.

Merger and acquisition in oil, gas and renewables are immensely growing.

In the Energy and natural resources industry, the merger and acquisition were stagnant in 2021. 

As these companies were looking to stabilise. The oil and natural gas industry are still splintered into many sectors and many of them remain slugged.

In spite of all, companies are turning to merger & acquisition to make more progress. 

Many of the companies already pursued deals which have accelerated the participation of companies in the energy transition and valuations are expected to rise.

5. Technology M&A

Technology is expanded with every deal and has been integral to the success of merger & acquisition. 

Today, we can see the importance of technology as the deals are increasing, and technology is also expanding. 

Technology executives are increasing with the complexities of mergers and acquisitions. 

Due to COVID19 the rapid speed of change in inflations, higher interest rates etc. have increased the merger & acquisition valuation opportunities, especially in the technology sector. 

The software enterprises and service providers are continuously buying in the new market and instead of developing in their house, they are buying new capabilities.  

6. Industrials M&A

Many of the small or medium sized companies find it difficult in running their business and competing with the new market. These companies find it money making to be acquired by the large companies for its functioning.

During the COVID-19 global merger and acquisition has strongly come back in 2022, the key targets for investment, merger and acquisitions.

The industrial merger and acquisitions have grown as compared to last year but the volume of deals was stable during that period.

7. Business Services M&A

We offer a wide range of corporate services at each stage of merger and acquisition. We provide transaction advisory services to the proposed and required due diligence for merger & acquisition.

8. Valuation Modelling

Valuation in business terms means the real market value of a company and its assets.

There is a full detailed process which must be followed in determining the actual value of a company.

This is usually done when one company plans to Buy or Takeover another company. Valuation helps in measuring the potential and knowing how a company performs in future and whether it is beneficial to buy that company or not.

Especia is one of the most trusted Firms in providing Valuation Services with more than 20+ years of experience.

There are many aspects of measuring a company's real market value. To know more detail about Valuation click here.

Cross Border Merger and Acquisition

Globalisation has increased the trend of cross-border merger and acquisition. We can see colossal growth in cross-border M&A. 

In simple terms, Cross Border merger means where the companies are located in two different countries. Therefore, merger of an Indian company with a foreign company or vice versa. 

A company must have a clear understanding, objective and strategy to expand the business globally. 

To find the right target company in the foreign market, due diligence analysis is required.

Due Diligence in merger and acquisition

Due diligence plays an essential role in merger and acquisition transactions. 

Due diligence allows the buyer to know the financial health of the target company and gives an assurance to the buyer what they are buying. 

Gathering information about the target company helps the buyer to make informed decisions.

Merger and Acquisition Strategies

The foremost strategy in merger and acquisition is to hunt the target company, then only further acquisition steps can be planned.

The buyer must study and have a clear understanding of the business of the target company before entering into any agreement.

Study the risk involved and the growth of the target company, and know about the financial health of the target company.

Study the market which is to be undertaken, it will give you an idea about the growth in the market.

Both the companies, i.e, acquiring company and the target company should give their consent before implementing the strategy of merger and acquisition.  

Finally, take the final approval from the shareholders and promoters of both companies. After that, the acquisition deal is finalised.

Examples of Merger and Acquisition

Google and Android 

Back in 2005, Google purchased Android for $50 million, the best purchase made by google. Google acquired the little startup, In the present, android is the most popular operating system (OS) in the world. Google spent almost three years developing its operating system for mobile devices. 

Verizon and Vodafone: Verizon communications Inc acquires a 45% stake in Vodafone for $130 billion. The acquisition was approved by both parties, i.e, Verizon and Vodafone. The company issued $60.2 billion in stocks to the shareholders of Vodafone.

Why Especia is the best choice for You?

Professional service firm like Especia is ready to access the full resources of a global network with an efficient and dedicated team focused on transaction service.

Our M&A Transaction services cover domestic as well as cross-border transactions. Our team professionals advise the clients at every stage of the transaction cycle from strategy, assessment & due diligence etc.  

We work with you to get the maximum benefit out of the transaction and maximise the value of the deal.

Our M&A Transaction Services team advises clients on managing M&A strategy, executing deals and providing tax advisory. 

We provide M&A services to clients throughout the transaction's lifecycle; from purchasing a company to structuring the transaction, from tax advisory to investigating potential fraud, all under the gamut of our Financial Advisory service offerings. 

We operate seamlessly across various functions within Especia to offer a complete suite of M&A solutions to our clients.

To qualify the role in transaction services, you are required to complete graduation from any university. The person should have specialisation in finance, business studies and economics.

There are five phases of merger and acquisition. 

  1. Pre-deal preparation and evaluation of transactional assumptions
  2. Due diligence
  3. Pre-closing planning 
  4. Post-close planning
  5. Post- close execution

By improving the performance of the target company.

Having faster skill and technology or at the lower cost.

Soon pick the winners and help them to develop their business.

Exploit the scalability of the business industry.

By removing the excess capacity from the industry.

Accelerating access to the market for the target company.

There are four steps on which the acquisition method is based:

  1. Identifying the acquirer
  2. Determining the date of acquisition
  3. Identifiable assets required must be recognised and measured, assume the liabilities and non-controlling interest in the company
  4. Measuring the goodwill

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