With the recovery of the U.S. economy and with record-setting amounts of capital in the hands of large corporations (“strategic buyers”), Private Equity...
Best-in-class sell side and buy side advisory to premier middle-market firms across multiple industries.
Newport’s M&A Advisors are some of the top M&A advisors in the U.S. With extensive backgrounds from Wall Street to the lower middle market, and extensive experience and expertise in what are extraordinarily complex areas, we advise clients in three major areas:
By definition, M&A transactions can materially affect your wealth and risk profile. Our M&A Advisors provide invaluable leadership to this process that has the potential to bring life changing, positive results to your life and the lives of your partners, employees, and all other constituents.
We work with you early, deeply, and holistically to ensure the best possible results.
Once it is decided by our client that a sale is required or desired, then the Newport M&A Advisory partners work to ensure the client is optimally positioned to “go to market.” With a deep understanding of all the intricate dimensions of buyer demand, our M&A Advisory partners work with you to substantively and optically prepare your company to attract maximum demand. From strategy to market position, to books and records, to execution and performance, our M&A Advisory partners prepare you for one of the most significant business transactions of your life.
Drawing on its many contacts in the investment community and deep M&A experience, Newport M&A Advisors manage sell-side and merger transactions ranging from $10 million to $250 million or more for non-sponsored companies, companies backed by financial sponsors, family-owned businesses, and corporate owners.
We work closely with our clients, guiding them through a process that can be challenging – and fraught with risk – for any executive, with or without extensive experience in M&A transactions. Each sell side transaction is unique in terms of the value inherent in our client’s company and the audience of prospective acquirers. Newport M&A Advisors are highly skilled at identifying and articulating the value proposition and marketing it to the appropriate audience, whether they are strategic buyers or financial investors.
Our process includes:
If your interest is in accelerating the growth of your company through an acquisition, or acquiring a company for strategic or other purposes, Newport M&A Advisors are the ideal partners for:
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Newport’s highly focused M&A Advisors cumulatively bring over a century of experience managing hundreds of transactions from $5 million to over $1 billion, totaling billions of dollars. Click on our team members below to learn more.
“Fred Fink provided exceptional support during one of the most critical times in the business’s entire lifecycle. His guidance and stalwart reliability were paramount in…”
“David Traversi worked with my company for years to build enterprise value by providing strategic advice, executive coaching to a number of our executives…”
“We are very pleased to have partnered with Newport LLC for this transaction.” Newport’s team was instrumental in helping DataWatt Solutions find the right partner…”
“David Traversi managed one of the most complex transactions in which I have ever been involved – a strategic acquisition from dozens of individual investors…”
“We invited Tony Cord and Fred Fink to work with our leadership team to help execute on the vision and growth strategy. As a global…”
We work with clients on transactions ranging from $10MM to $250MM or more, across the United States. We advise across a wide variety of industries, and it is rare in our 50-person partnership that we lack the industry expertise or connections to deliver our best-in-class advisory services for any given client. But, as your trusted advisors, if we determine your transaction needs are better served by another advisor, we work with you to identify and retain that advisor.
An M&A advisor, such as Newport’s M&A Advisory partners, is an expert in all aspects of sell side and buy side business transactions. They work with you on preparing your company to sell, understanding the value of your company, analyzing the market, creating and executing the “go-to-market” strategy, working with your tax and other advisors to understand the tax and legal aspects of the transaction and structure toward your best results (e.g., best economics, lowest risk), negotiating on your behalf, and ultimately closing the transaction. They focus on transactions ranging from $10MM to $100MM or more. An M&A advisor generally charges a retainer and a success fee in the 2% to 8% range. Business brokers on the other hand, tend to work on businesses worth $5MM or less and charge higher success fees (in the range of 8% to 15%). Business brokers generally focus on the process of the sale not on the health and strength of your business and specific goals you may have for the transaction. Newport M&A Advisory partners have deep experience as CxO’s and know how to help prepare the business to maximize the benefits of your specific transaction.
Possibly, but the better question is “why would you do that?” A good M&A advisor, like Newport’s M&A Advisory partners, deliver incremental value that greatly exceeds the costs of our services. We do this by, first, expertly negotiating on your behalf the hundreds of complex nuances of the transaction and, second, saving you the full-time effort it requires to manage these transactions and allowing you to continue managing your business. Simply put, with a sophisticated advisor like Newport’s M&A Advisory partners, you realize significantly better overall economics, materially reduce your risk, and substantially accelerate process.
A business is worth what someone will pay for it. The definition of fair market value is the amount a willing Buyer will pay a willing Seller in the absence of duress. But, on a more practical basis, an overwhelming majority of businesses sell for a multiple of EBITDA, (i.e., Earnings Before Interest, Taxes, Depreciation, and Amortization). That EBITDA can be historical, current, or projected. The multiple can vary widely depending upon industry, comparable transactions, projected and historical growth, size of company, nature of revenue (e.g., recurring or non-recurring), uniqueness of the seller’s product or service, and other factors. Some businesses trade on other bases, such as asset value and multiple of revenues. Newport’s M&A Advisory partners will work with you to identify the appropriate valuation method and optimize the value in your favor.
Buyers generally fall in one of two categories: financial or strategic. Financial buyers are generally sponsored by private equity or venture capital firms, with a primary purpose of earning a financial return on their investments. Strategic buyers, while still concerned with earning a financial return, are more focused on the strategic reasons for an acquisition. In buying your business, they may want to enter a new market, add to their existing presence in a market, or add it to an existing portfolio of complementary businesses.
Sales of businesses are structured as either an asset sale or a stock sale. In an asset sale, the Seller remains the owner of the legal entity and retains long-term debt obligations (unless specifically assumed by the Buyer). In a stock sale, the Buyer buys the entity and receives all the assets and assumes all the liabilities (subject to any negotiated exceptions). Our M&A Advisory partners can explain to you the many critical differences between these two types of transactions and why buyers generally prefer asset sales and sellers generally prefer stock sales.
It is unlikely. There are a number of factors that come into play that reduce the cash you receive at closing. For instance, there may be business debt that must be repaid at closing. There may be “holdbacks,” or money that the buyer “holds back” at closing for a negotiated period to cover any number of cash needs that may arise after the closing that are rightfully the obligation of the seller. These needs may be to fulfill indemnity or warranty commitments that are made by the buyer at closing. The parties may agree to an “earn out,” an agreement in the purchase and sale agreement that part of the purchase price will be dependent upon the buyer being able to earn a certain amount of money after the sale, usually defined as either revenue, gross profit, or net profit. Or the buyer may demand you finance a portion of the purchase price over time. Or the buyer may want to allocate some of the purchase price to a services contract that requires you to work after closing for a portion of the purchase price. As a sell side advisor, Newport’s M&A Advisory partners work closely with you to maximize the cash you receive at closing and minimize contingencies that the buyer will likely want to impose upon your payments.
Some of the questions we ask to answer this question are: (1) has business performance been sufficiently solid such that you are not promising a hope or a dream to a buyer but, rather, a continuation of a solid revenue and profit stream? (2) do you have complete books and records? (3) do you have an absence of litigation or potential litigation affecting your business? (4) do you have the unfettered legal ability to sell? (5) do you have at least the informal agreement of key employees? and (6) do you have the time to mage the sale process? Of course, this is just a start, and Newport’s M&A Advisory partners can quickly work with you to determine your readiness to sell.
At Newport, we always advise the hiring a premier M&A lawyer. This is no place to try to save money by hiring a generalist lawyer. In fact, you will save money and optimize all other terms of a transaction by hiring an M&A specialist. Newport’s M&A Advisory partners can work with you to select the appropriate counsel and manage your relationship with them to minimize cost and maximize results. We also advise hiring a tax expert, given the many, varied, and complex tax issues that arise in these transactions. And you should prepare solid books and records, prepared in accordance with standard accounting practices, and compile and organize all supporting records and documents. Preparing a due diligence or data room in advance of going to market with a transaction has become a necessity in the M&A world. Again, our M&A Advisory partners are experts in structuring and helping you stock a complete data room that usually satisfies 95% of what a buyer may need for its due diligence. Our M&A Advisory partners will also work with you to prepare a financial presentation that will be critical to marketing your business.
First, you’ll need a combination of a teaser, which is a one-page overview of your company and the intended transaction, and a confidential information memorandum. You’ll provide the content for these and Newport’s M&A Advisory partners will help you shape these two documents that will be provided to potential buyers of your company.
We advise sellers to not put a price on their business. Rather, we think we should build demand for the business and then solicit bids. If a potential Buyer presses hard for price, we usually respond verbally with a range of your expectation “based on what the market has indicated thus far.” That range should be the lowest you would ever possibly take and something much higher, higher, in fact, than you think anyone would ever pay for the business.
A typical sell side transaction can take as little as 90 days and as long as year or more. At a high level, the 30- to 45-day pre-marketing phase consists of hiring legal and tax advisors, stocking the data room, preparing the teaser and confidential information memorandum, and preparing the list and contact information of target buyers. The 45- to 90-day marketing phase consists of contacting potential buyers and sharing the teaser with them, sharing the confidential information memorandum with potential buyers expressing that interest, meeting with interested buyers, soliciting letters of intent from interested buyers, and negotiating and signing a letter of intent with the buyer you have selected. The 15- to 45-day documentation and closing phase consists of opening the data room to the prospective buyer and meeting its data needs, negotiating the purchase and sale agreement, and closing the transaction. Newport’s M&A Advisory partners are experts in managing this complex process to optimize the transaction for you in every respect.
It is never a good thing for everyone in your business’ ecosystem to think it is for sale. But there is a reality and you have to deal with it. The reality in most cases is not that you are for sale, given you are not going to sell if the price and all other terms are not to your liking, and particularly if there is no buyer for it. The reality is that you are exploring your alternatives, as every business owner should do on a continual basis to be most responsible to his or her employees, customers, family, investors, and even community. None of those constituents would be satisfied with a business owner that is not curious, conscious about markets and market conditions, the competitive environment, and economic forces affecting the business. Newport’s M&A Advisory partners are experts in working with you to craft the appropriate communication strategy.
As veterans of hundreds of M&A transactions, we are experts in making the process manageable and then managing it well. We work closely with you to schedule the process with significant detail, keep all players accountable and on schedule, and drive through to a successful closing.
“Fred Fink provided exceptional support during one of the most critical times in the business’s entire lifecycle. His guidance and stalwart reliability were paramount in the transaction process. Fred went above and beyond at every step of the way and I give him my highest recommendation.”
Josh Courtney, DO
Founder and CEO
“David Traversi worked with my company for years to build enterprise value by providing strategic advice, executive coaching to a number of our executives, executive team building, and, ultimately, advising us on our highly successful sale to a strategic buyer. He is an expert at advising clients on building and then realizing value.”
Radiator Express (since sold)
“We are very pleased to have partnered with Newport LLC for this transaction.” Newport’s team was instrumental in helping DataWatt Solutions find the right partner, and they were an integral part of negotiating the terms of the transaction. Newport provided sound advice and insight to our management team throughout the process. Their knowledge of private equity firms who are active in our industry was critical to finding the right partner.”
“David Traversi managed one of the most complex transactions in which I have ever been involved – a strategic acquisition from dozens of individual investors, a debt financing with a large, non-bank institutional lender, and challenging interpersonal dynamics – with utmost skill, professionalism, and persistence. The advisor you want in your corner.”
Amerit Fleet Solutions
“As a family business, we were always looking for ways to guarantee SSC’s continued success for future generations. We believe our partnership with Division 5 will create opportunities for our employees and our new, combined company while allowing us to continue providing excellent customer service to customers, new and old. The Newport team helped us achieve our objectives and complete the transaction in the middle of a pandemic. We couldn’t have done it without Jed Dunn’s and Fred Fink’s commitment to us.”
Founder & CEO
Structural Steel of The Carolinas
“David Traversi managed the very successful sale of our IT services/mobile app development company to a name-brand strategic acquiror with consummate professionalism. Highly skilled and experienced in highly complex M&A transactions, he is the best of advisors and advocates for his clients – honest, transparent, and responsive.”
Two Toasters (since sold)
“We invited Tony Cord and Fred Fink to work with our leadership team to help execute on the vision and growth strategy. As a global company with a dominant position in the Urban Mobility industry, we needed to transform our business model and provide additional services to our customers to maintain the competitive edge. In this regard, the Newport Board Group was instrumental in advancing our M&A strategy. In addition, our leadership team itself was undergoing transition with the appointments of a new CEO and CFO. With assistance from Newport Board Group team, the newly-formed deal team had to quickly learned about each other’s strengths and working styles. Tony and Fred worked with us to not only guide us through the process of target sourcing but also were instrumental in representing our brand to the prospective target companies. Their soft touch approach, deep expertise in growth strategies and execution, and willingness to roll-up their sleeves was instrumental in our success. Tony and Fred’s calm demeanor and voices of reason helped save the day often times when emotions were running high. They have been an absolute joy to work with and I would not hesitate to recommend them to any organization that needs C-level Whisperers for continued success.”
Rohit M Chande
SVP, Engineering Services