Acquisition with Obstacles
In this mandate, the focus was on a young technology company owned by several investment firms. The company’s management planned an ambitious acquisition: the purchase of another technology company, in exchange for issuing new shares as a contribution in kind.
Thomas Strobl had recently taken on the role of Interim CFO in the company, as the previous incumbent had left and the search for a suitable successor was time-consuming. Consequently, he was also tasked with leading the complex acquisition project and bringing it to a successful conclusion.
Valuation and Appraisal
The first major challenge was the financial valuation of the target company. Although the management had already agreed with its shareholders on a rough valuation at which the transaction could take place in principle, this value naturally had to be supported by facts. And this was not necessarily apparent, as the target company had only reported losses up to that point.
Thomas Strobl’s task was therefore to first work with the management of the target company to create a solid business plan. This plan had to consider business potentials as far as they plausibly appeared, but on the other hand, prevent implausible developments not supported by concrete measures from entering the planning and thereby the valuation process. The challenge was to critically question the management’s assumptions while not negating realistic positive aspects due to an overly conservative view.
To save time, Thomas Strobl worked closely and early with the auditors. The most important assumptions and developments of the business plan were thus known to them early on. They could ask their questions and demand additional information. This enabled Thomas Strobl to complete both the business planning and the auditors’ appraisal within the available time. Additionally, such an approach could be seamlessly integrated into a comprehensive due diligence process, as essential information was already available in the Data Room.
Legal Aspects of the Capital Increase
The legal aspects of the transaction were no less complex. Therefore, Thomas worked closely with the company’s lawyers to ensure all tasks related to the planned capital increase and the issuance of new shares were legally compliant. He ensured that all legal requirements were met and that the process was in line with the interests of both existing and future shareholders.
Persuasion Among Shareholders
Another challenge was convincing the existing shareholders of the benefits of the acquisition, as opinions among them were not uniform. Thomas Strobl, along with his colleagues in the executive management, took on the task of advocating for the transaction with the investment firms.
He presented the strategic advantages of the acquisition and addressed critical questions. Points where real resistance emerged among shareholders were incorporated into ongoing negotiations with the sellers. This approach eventually led to a viable path for all parties involved.
Closing and Integration
As part of his mandate, Thomas Strobl was also involved in the integration of the acquired company. It was crucial to conduct difficult discussions with tact and strategic foresight. His goal was to reach agreements that represented a credible win-win for both parties, thereby avoiding unnecessary fears among the employees.
In the end, he successfully coordinated and completed all necessary steps. The acquisition was supported by the shareholders, and the integration of the target company began promisingly. The employees were also convinced by the strategic perspective of the combined company.
This story illustrates the critical role of an experienced CFO in complex corporate acquisitions. Thomas Strobl’s ability to intertwine financial, legal, and human aspects into a coherent whole was a key factor in the success of this ambitious endeavor.