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Mergers & Acquisitions


Prempeh Capital’s merger and acquisition (“M&A”) advisory capabilities are one of the foundations of the firm’s history and success. Prempeh Capital’s professionals have extensive backgrounds in representing both buyers and sellers of companies across a wide spectrum of industries. Prempeh Capital has a strong track record of utilizing creatively providing buy or sell side advisory services tailored to our clients’ needs and goals. Prempeh maintains an extensive nexus of connections with active (public and private) strategic buyers and a multitude of financial buyers. We have consistently utilized these relationships in order to introduce our clients to the broadest range of potential buyers and sellers. This in turn gives our clients multiple options for a merger partner, usually at an above market multiple valuation for our sell-side transactions.

Merger and Acquisition Advisory Services:

  • Buy-side and sell-side assignments
  • Corporate divestitures and leveraged buyouts (LBOs)
  • Management buyouts (MBOs) and ESOP buyouts
  • Advising clients on their strategic merger or acquisition strategy
  • Formulating a valuation range
  • Conducting acquisition searches for buyers
  • Identifying potential buyers or acquisition candidates
  • Constructing and writing a Confidential Information Memorandum and any associated selling documents
  • Assisting in structuring and negotiations with all parties
  • Coordinating all meetings
  • Arranging any equity or debt financing
  • Coordinating other advisors including: legal, accounting and other required closing activities
Analyzing Alternatives

We carefully analyze our client’s alternatives to determine when a sale, merger or acquisition meets our client’s objectives. Prempeh Capital always seeks to present to our client a full spectrum of alternatives, which can include: (1) a full or partial sale to current management, (2) a sale or merger with a public or private competitor, (3) an acquisition of a competing publicly held, private or family owned company, or (4) an acquisition by a private equity or hedge fund. We analyze both our client’s company as well as the acquirer or seller and evaluate both the financial and operational structure of both entities. In addition, we analyze in detail what result can be expected from a merger or acquisition transaction. This analysis allows our clients to fully understand the synergies (or the lack thereof) in a prospective merger long before it commits to a definitive strategy.

Creating and Increasing Value

Prempeh Capital seeks to create added value for our clients in any merger or acquisition. We believe that the process of doing so must begin with a careful analysis of the company’s financial, operational and market performance as well as its future potential. It is then essential to evaluate our client’s strengths and weaknesses in the context of the market in which it operates. Our goal is to create maximum shareholder value for our client in either a merger or acquisition and to produce a result, which either meets or exceeds our client’s expectations. Our professional qualifications and decades of experience in the financial analysis, structuring and negotiation of complex transactions have produced outstanding results for our clients over many years.

 
Leveraged Buyouts


Prempeh Capital has guided many clients through the complex stages of a leveraged buyout, whether for a client finding itself the target of such a proposal, on a “friendly” or “unfriendly” basis, or for a client seeking to utilize the leveraged finance markets to permit it to undertake a vital strategic acquisition. We are thoroughly familiar with a large variety of financial engineering techniques and products necessary for the execution of successful leveraged finance transactions. In addition, we are in constant communication with the diverse and constantly evolving sources of leveraged finance.

We have also assisted many clients in raising debt capital, utilizing leverage of their assets and cash flow to permit the successful conclusion of a transaction. The use of leverage in the proper proportions is essential to increasing growth through acquisitions. A leveraged recapitalization can facilitate a distribution of capital to existing shareholders when other forms of liquidity are unavailable.

With Prempeh Capital’s thorough knowledge of and range of relationships with today’s leading leveraged lending and structured finance institutions, companies can utilize several forms of debt including: senior secured asset and cash flow bank and non-bank debt, senior credit facilities and revolvers, senior term A and B loans, junior term and mezzanine debt, high-yield debt, short-term bridge loans and private debt placements.

 
Restructuring


Prempeh Capital provides a wide variety of restructuring/recapitalization options to healthy as well as distressed companies. These services cover: (1) company and asset valuations, (2) enhancing corporate liquidity, (3) increasing the equity base, (4) increasing options for working capital finance, or (5) sourcing capital for an acquisition or divestiture program. We will work to find the optimum balance among the many types of debt and equity options which best suit a company’s operating needs, and the form of recapitalization, which meets those needs.

Areas of Focus
  • Restructuring distressed debt and equity
  • Raising new private equity and or debt
  • Debtor-in-possession financing
  • Chapter 11 exit financing
  • Mergers & acquisitions
  • Valuation services

 
Divestitures


Prempeh Capital provides seller advisory services to public companies, privately held family businesses and private equity firms. These advisory services cover spin-off or divestiture transactions of companies or divisions, which may no longer fit the company’s strategic plan, or may have extensive capital needs which are inconsistent with the parent company’s broader goals, or disposition may be necessary to raise vital funds for the survival of the main business. In such assignments, Prempeh Capital brings to bear its extensive experience in preparing and positioning for sale small to medium sized companies, and understands what such business segments require in order to appeal to an industry-specific strategic buyer or to a private equity fund or other financial buyer. Often the parent/seller fails to realize that such transactions can require extensive preparation and positioning of the soon-to-be divested division or subsidiary. Prempeh Capital can add invaluable assistance in this process by allowing the parent to focus on its operations, while Prempeh Capital runs the divestiture process.

We bring to each phase of the sale process- valuation, preparation of the confidential memorandum, positioning of the business to the marketplace, preparation of key personnel, coordination of the due diligence process, strategy, identification of and careful management of contacts with potential bidders, management of the bidding process itself, selection, if necessary, of critical legal and other professional advisors, and successful structuring, negotiation and closing of the transaction-the same meticulous attention to detail which characterizes our highly successful M&A practice.

Not every divestiture transaction is suited to a broad-based auction process, and we do not hesitate to recommend a targeted, structured, narrower approach if the nature of the business and the logical interested buyers will best be found in that way.

When a transaction is motivated by liquidity needs of the parent to be funded by a closing special dividend, or to be facilitated by putting in place a pre-arranged stapled financing package, we assist in securing related financing. We approach such assignments with an awareness of the conflicts of interest inherent in financing provided by a sell-side advisor, and work with our client to avoid them. Our broad range of institutional lender relationships assures that, when necessary, such financing is treated as integral to, and sourced concurrently with, the sale process itself.

 
Corporate Valuations / Fairness Opinions


Prempeh Capital Partners provides valuations or fairness opinions in over 40 industries, to both US and foreign companies. A valuation analysis is usually the foundation for any type of business transaction. Many times a company has requested Prempeh Capital to produce a valuation analysis before they decide what type of transaction they will pursue, or whether to pursue the transaction at all. In addition, a client may need a fairness opinion to complete a transaction, which has already been negotiated between the two parties, but needs a third party confirmation of the value of the entities in a transaction.

A well grounded knowledge of a business’s current market valuation is critical to: creating a successful business plan, expansion and growth, utilizing stock options for management compensation, refinancing, acquisitions or restructuring. While an owner may have no present wish to sell the business, an understanding of current market value and how to enhance that value is a critical component of the process of planning and preparing for growth.

Prempeh Capital’s valuation analysis services can help a business owner or management team understand their company’s current valuation and be a critical tool in formulating strategies for preserving and enhancing the company’s valuation. Our professionals have extensive experience valuing lower middle market sized businesses across a broad range of industries.