Great content Brett, I currently lead a team for M&A doing mainly consolidations in the marine industry. The comment on "Culture eats strategy for lunch" is 100% spot on. Culture assessment and integration is one of the harder aspects of acquisitions in gauging a good fit and adoption of the parent companies culture.
Hi Brett! Thanks for these uploads regarding mergers and acquisitions, they are very helpful! I’m currently a college freshman and ever since high school I’ve always wanted to become a corporate lawyer. Your videos help me a lot in terms of learning the general sphere of how deals play out. Thanks!
you're welcome, Hamza. That's interesting that you've wanted to be a corporate lawyer since an early age. I have videos where I talk about how I didn't understand what a corporate lawyer really did until my second year of law school! So, you are way ahead of the game!
Hi, thanks for great video. Shell acquiring "vlta" for 0.86 cents, all cash deal with 18% premium. I'm still holding my shares at 80% loss. I did not vote. If the acquisition is not approved by the shareholders on March 29. What usually happens to shares price? On the other hand, the company is at risk of going bankrupt with this incompetent management because there is no cash :( What would you do at this stage if you were in my place? Sell now and accept loss or go all the way end? Thanks
i recently subscribed and have watched a few hours of your videos. I have a question that i haven't found an answer to. say a buyer in the due diligence stage asks a seller to see his IP (more specifically, trade secrets), in the case that the buyer decides not to buy, what protection/assurances does a seller have that the buyer won't divulge the trade secrets he saw.
Great question! Anything highly confidential, which would certainly include trade secrets, should only be disclosed after the buyer signs a confidentiality agreement (aka non-disclosure agreement or NDA). We have buyers sign those early in the process -- before we give them anything (or very little) that isn't publicly available. Getting an NDA signed and enforcing one are two different things. Ultimately, if a bad actor buyer wants to put certain confidential information to work, it may be tough to prove that they are doing so and, in fairness to all buyers, they can't unlearn things, so some information will go into their heads and there is no way around them having that information going forward. That type of information, though, is more along the lines of marketing approaches, financial results, customer lists (also, FYI, at higher levels (larger deals) there is more process to navigate around disclosing customer and pricing information at all due to antitrust laws). When it comes to trade secrets, if you are guarding them like they should be safeguarded (disclosing rarely and only as needed and protecting them carefully) and if the information got into the public domain, you might be able to trace back the breach fairly easily and hold the disclosing party responsible. In my experience, most companies operating in the lower middle market ($2MM - $50MM), have far less confidential information (especially trade secrets) than they think they have. Business owners often value their information more than the market does. So, while this is an issue to navigate carefully, it's also a risk that most business owners ultimately find acceptable to get a deal done. At some point, you need to disclose the information. Granted, "sometimes" can be late in the process. We have done deals where the seller does not disclose their customer list until post-closing. That's tough to get a buyer to agree to, although not impossible. More commonly, we may disclose very sensitive information after the buyer completes all of its due diligence a, d the deal is well toward closing (that is not a common approach in deals overall, just more common than disclosing any certain information only after the deal closes).
@@BrettCenkus that was very informative, thank you. keep making more videos, I'm breathing them in like they are air. PS: some information on M&A deals between entities in different countries would be nice
@Brett Cenkus your vids have been a great source of information for me as a business owner planning on acquiring other business for synergies/expansion etc. I do currently have customers that represent a significant percentage of revenue and we dont have an actual contract/written agreement. Im I n a position to have a sitbdown with them and propose one...do you have one or a template that can be used so that proper documentation and reflection of value on my business will be evident? Maybe one that is assignable as well? I am NOT planning on selling but am extremely interested in getting the backroom stuff ironed out and well organized so that everything is in place and transparent etc. Please let me know or provide contact information if you dont have one online but can maybe put one together..(?) Im interested in a professional one as opposed to a cookie cutter looking one. Thanks!!
Frenchy, everything in our world starts with a precedent agreement (a similar agreement from a different transaction). That is the "template," although there isn't a standard template, at least we don't have one, for customer contracts. We work with clients to develop form customer contracts (by "form," we mean their custom template that they can use over and over because their business doesn't change). To do that process well we schedule an intake call with the client to gather information and figure out what's important to them, where they see risks in their business (with their customers), etc. We prepare a draft version, they provide feedback, we prepare another version usually. And then we build in one round of revisions after the first customer reviews and negotiates the "form" (because, as the saying goes, "no battle plan survives contact with the enemy." All-in, this typically takes us approximately 10 hours, or $3,500. That's not cheap, I realize, although it's solid, custom work. It can be a little less time (money) and sometimes more, although I'd estimate 90% of these projects fall within $2,500 - $5,000. If you want to do that, reach out to us at 512.888.9860. If you want to explore the idea more, you can schedule a call with me at clarity.fm/brettcenkus.
Great content Brett, I currently lead a team for M&A doing mainly consolidations in the marine industry. The comment on "Culture eats strategy for lunch" is 100% spot on. Culture assessment and integration is one of the harder aspects of acquisitions in gauging a good fit and adoption of the parent companies culture.
Thank you for the content @Brett Cenkus, I'm starting to create a target list of accounting firms.
you're welcome!
Hi Brett! Thanks for these uploads regarding mergers and acquisitions, they are very helpful! I’m currently a college freshman and ever since high school I’ve always wanted to become a corporate lawyer. Your videos help me a lot in terms of learning the general sphere of how deals play out. Thanks!
you're welcome, Hamza. That's interesting that you've wanted to be a corporate lawyer since an early age. I have videos where I talk about how I didn't understand what a corporate lawyer really did until my second year of law school! So, you are way ahead of the game!
Hi, thanks for great video.
Shell acquiring "vlta" for 0.86 cents, all cash deal with 18% premium.
I'm still holding my shares at 80% loss. I did not vote. If the acquisition is not approved by the shareholders on March 29. What usually happens to shares price?
On the other hand, the company is at risk of going bankrupt with this incompetent management because there is no cash :( What would you do at this stage if you were in my place? Sell now and accept loss or go all the way end? Thanks
Hey Brett, can you please do a video on the JD/MBA path? Benefits/downfalls, etc...
I posted a video on the pros and cons of the JD-MBA yesterday -
ua-cam.com/video/61IaFPXL_xI/v-deo.html
i recently subscribed and have watched a few hours of your videos. I have a question that i haven't found an answer to. say a buyer in the due diligence stage asks a seller to see his IP (more specifically, trade secrets), in the case that the buyer decides not to buy, what protection/assurances does a seller have that the buyer won't divulge the trade secrets he saw.
Great question!
Anything highly confidential, which would certainly include trade secrets, should only be disclosed after the buyer signs a confidentiality agreement (aka non-disclosure agreement or NDA). We have buyers sign those early in the process -- before we give them anything (or very little) that isn't publicly available.
Getting an NDA signed and enforcing one are two different things. Ultimately, if a bad actor buyer wants to put certain confidential information to work, it may be tough to prove that they are doing so and, in fairness to all buyers, they can't unlearn things, so some information will go into their heads and there is no way around them having that information going forward. That type of information, though, is more along the lines of marketing approaches, financial results, customer lists (also, FYI, at higher levels (larger deals) there is more process to navigate around disclosing customer and pricing information at all due to antitrust laws). When it comes to trade secrets, if you are guarding them like they should be safeguarded (disclosing rarely and only as needed and protecting them carefully) and if the information got into the public domain, you might be able to trace back the breach fairly easily and hold the disclosing party responsible.
In my experience, most companies operating in the lower middle market ($2MM - $50MM), have far less confidential information (especially trade secrets) than they think they have. Business owners often value their information more than the market does. So, while this is an issue to navigate carefully, it's also a risk that most business owners ultimately find acceptable to get a deal done. At some point, you need to disclose the information. Granted, "sometimes" can be late in the process. We have done deals where the seller does not disclose their customer list until post-closing. That's tough to get a buyer to agree to, although not impossible. More commonly, we may disclose very sensitive information after the buyer completes all of its due diligence a, d the deal is well toward closing (that is not a common approach in deals overall, just more common than disclosing any certain information only after the deal closes).
@@BrettCenkus that was very informative, thank you. keep making more videos, I'm breathing them in like they are air.
PS: some information on M&A deals between entities in different countries would be nice
@@Franck-mj1vt I will plan a video on cross-border M&A. Great idea! Thank you.
@Brett Cenkus your vids have been a great source of information for me as a business owner planning on acquiring other business for synergies/expansion etc. I do currently have customers that represent a significant percentage of revenue and we dont have an actual contract/written agreement. Im I n a position to have a sitbdown with them and propose one...do you have one or a template that can be used so that proper documentation and reflection of value on my business will be evident? Maybe one that is assignable as well? I am NOT planning on selling but am extremely interested in getting the backroom stuff ironed out and well organized so that everything is in place and transparent etc. Please let me know or provide contact information if you dont have one online but can maybe put one together..(?) Im interested in a professional one as opposed to a cookie cutter looking one. Thanks!!
Frenchy, everything in our world starts with a precedent agreement (a similar agreement from a different transaction). That is the "template," although there isn't a standard template, at least we don't have one, for customer contracts. We work with clients to develop form customer contracts (by "form," we mean their custom template that they can use over and over because their business doesn't change). To do that process well we schedule an intake call with the client to gather information and figure out what's important to them, where they see risks in their business (with their customers), etc. We prepare a draft version, they provide feedback, we prepare another version usually. And then we build in one round of revisions after the first customer reviews and negotiates the "form" (because, as the saying goes, "no battle plan survives contact with the enemy." All-in, this typically takes us approximately 10 hours, or $3,500. That's not cheap, I realize, although it's solid, custom work. It can be a little less time (money) and sometimes more, although I'd estimate 90% of these projects fall within $2,500 - $5,000. If you want to do that, reach out to us at 512.888.9860. If you want to explore the idea more, you can schedule a call with me at clarity.fm/brettcenkus.