Mergers
Our merger advice seeks to create value above and beyond our client’s strategic objective. Having advised more than 125 families and companies, we are sensitive to the specific family dynamics and business understandings of the merging entities.
In our experience, a viable merger is not solely about achieving financial success, but also about creating trust, and proudness, among owners, management and employees.
Financially sound merger-advice is much more than skilful negotiations. Different business models, corporate cultures, and families require different approaches. Therefore, we identify opportunities for the merging parties in order to co-exist, develop the business, and prosper together.
Mergers can be sensitive. Sometimes, disclosing financial information and intimate knowledge in a merger with a peer can be perceived as riskier that in a full acquisition. Our responsibility is to safeguard our client throughout the process and also in the situation when that merger does not close.
In the case of family ownership, pre-conceptions rooted in long-standing ownership may arise in a financially successful merger. We believe in straight forward highlighting of the pros and cons and we will rather take our client unharmed out of the deal, than pursue a transaction that will not serve our client’s best interest.
Concerns may surface when the idea of merging appears; especially with regards to the role of individual family members in the new entity.
In our 25 years of experience, it is the confidential and private conversations between the owners and our senior partners, giving due consideration to both the financial and personal risks and benefits, that ensures a fair and successful deal for all family members.
RIóN delivers clear, thoughtful merger-advice leading to successfully executed transactions firmly founded in practical reality, which makes sense in all financial and corporate aspects, and creates trust and proudness, among owners, management and employees.
An example from the real life
RIóN advised Higiene Textil, one of the top-three industrial laundry services companies in Mexico. Major players had held talks around a possible merger, with the aim of reducing operating costs and securing access to a larger number of high-volume customers.
Resolving long-standing concerns for our client, RIóN negotiated the financial parameters and determined the equity stake for each of the parties in the new merged company.
We advised in the establishment of new management and governance bodies ensuring our client’s vision, while achieving a healthy balance between the partners, and a smooth and viable transition, enacting resolution mechanisms to solve any conflicts, and clauses protecting minority shareholders but making sure they would not interfere in the normal course of business.
RIóN’s advice established clear exit mechanisms, including how to sell shares internally, and facilitated the creation of the new merged company.
Lavartex is today the largest company in the industrial laundering services market in Mexico.