Maintaining and creating corporate value through M&A — but how?
Before markets could get used to the “new normal” after a good two years of pandemic, geopolitical crises are adding to the uncertainties and forcing entrepreneurs around the world to deal with ongoing supply chain issues, rising inflation rates, and expected fiscal and monetary policy responses, including on the cost of capital. The challenges are too fundamental to duck out of sight and hope for better times; to make matters worse, there are also the pressures of digitization and significantly increased environmental, social and governance (ESG) hurdles that must also be overcome.
First of all, I recommend a ruthless stocktaking of the company with an all-round view of all challenges but also opportunities, including the capital requirements and possible perspectives for the entrepreneur and family, and in doing so to play through various scenarios, for example: (acquisition) purchase or (partial) sale or merger? The only thing that seems certain to me is that active players will have more opportunities and prospects than reactive players, who in the worst case scenario will go from being players to being pawns. Secondly, I then recommend to act accordingly! Too often, such topics are otherwise just put on the back burner.
There are many factors for the success of companies. Apart from the top management, two of them are of paramount importance in my opinion: strategy and capital. Without strategy, capital is not created or will quickly evaporate, and without capital, strategies are difficult to implement. Both condition each other and seek each other. It is well known that M&A must be an elementary component of every corporate strategy.
If a company does not have its own original potential for growth, a merger or acquisition is, in my opinion, without alternative — apart from a sale. Because, only then can new product and market potentials be gained or know-how be expanded. Some also solve their own company succession through M&A. VIRETUM CONSULT advises on the development and formulation of strategies and on the procurement of suitable equity and debt capital. Even before founding VIRETUM CONSULT, I have conducted dozens of M&A transactions myself as founder, buyer or seller. Therefore, I know the concerns of all parties involved from my own experience. My heart beats for traditional companies as well as for start-ups with innovative products and business models. “The variety in dealing with both at all stages of their development makes the consulting work particularly exciting for me, and my clients also benefit from it.”
About Hanns-Peter Wiese
Hanns-Peter Wiese, Dipl.-Kfm., has more than 25 years of business, corporate finance and M&A experience. Prior to founding VIRETUM CONSULT, he was a director of a major German bank in the field of corporate finance, head of M&A at a corporate finance firm as well as managing director, general partner and manager of several private equity and venture capital companies. He has completed over 100 transactions with more than 50 companies in various industries in Germany, Western Europe and the USA. He accompanied a large number of these companies in their business cycles over many years as a sparring partner to the management or as a member of the supervisory or advisory board and actively supported them in numerous financings, M&A transactions and IPOs.