Managers who have the opportunity to
acquire businesses often need outside capital and financial expertise to complete such
transactions.
Capital
Markets Group, Inc. may represent
either the management group or the selling company in such transactions.
When we represent the selling company,
we not only advise on the negotiations but also provide backup buyers for the
company in case the management team fails to consummate the deal. Thereby not
allowing the selling company to be a "captive" seller and run the risk of
failing in its mission.
When the management team looks for
capital, they often go immediately to a bank to determine how much they can borrow and
then look for the remainder elsewhere. That is exactly opposite of the best way to
put together financing for a Management Buyout.
When we represent the management
buyout team, we not only advise on the negotiations but also raise the necessary capital
to consummate the deal.
We will raise
equity (usually provided by the management team and amounts to less than 5%-10%
of the total purchase price}, mezzanine financing, subordinated debt and then senior debt
in the most advantageous mix to allow the management team to be assured of success and
reasonable cash flow after the deal is completed.
We want our clients to have
sufficient cash flow after the buyout and not face a financial crisis because of
over-leveraging.
Appropriate buyout candidates
generally have sales in excess of $7 million.
Capital
Markets Group, Inc.'s experience in
valuations, negotiations and years of worldwide association with buyers and capital
sources
allows us to help you in structuring realistic and preferential terms for either the sale
or management buyout of your company.
We work with
company owners, management, lendors,
investors, and buyers in Europe, Canada, Japan, Hong Kong, Australia, The Caribbean, and
of course throughout the United States.
Our
27 years of experience gives us
the intimate knowledge of hundreds of professional investors, lendors and buyers and
allows us to provide you with the best alternatives to reach a well thought out and
executed solution.
