Methodology
Our acquisition methodology
Because we are constantly evaluating further acquisitions, we have a continuous process for identifying interesting companies that are, or may reasonably be considered to be, for sale. Companies may, for example, be facing a generation shift or have an ownership structure that does not present the right conditions for future, positive development.
Based on available public data, IDESTA first carries out an external analysis of the company. If the company is considered to satisfy our requirements as regards potential profitability and growth, we inform the company of our interest. This can be done in a number of ways. Most usually, we present a declaration of intention that gives details of IDESTA and sets out the reasons for our interest and how we believe that the company can continue to develop with IDESTA as owner. The development of mutual confidence between ourselves and the present owners is entirely decisive for the taking of further steps.
To then progress to a concrete bid that can be the basis for a deal, we carry out an in-depth analysis in collaboration with present owners who have a certain degree of access to internal company details. The analysis seeks to substantiate the factors that gave rise to our interest in the company. To confirm the present owner’s view of the company and the market’s development, it nearly always includes contact with a number of the most important customers. On top of this, discussions with key company personnel who will continue to work under the new set-up are often required. After this phase, IDESTA submits a concrete bid that includes details of the financing and the schedule for the transaction.
On agreeing the deal’s details with the vendors, we finally carry out due diligence for the takeover. In order to identify any defects and risks that could affect us as new owners, this entails an in-depth examination of the company’s accounts, contracts, order books, etc.
On satisfactory completion of due diligence, there is the transaction itself and IDESTA takes over responsibility for the company and its employees. We often choose to have a transition period in which the previous owners remain in roles designed to ensure smooth development of customer and supplier relations. This is particularly important where the previous owners played an active role and were, perhaps, the outward face of the company.
