Yours To Discover Conference 2012 Growing, Buying or Selling a PCC What is your business worth?
Growing, Buying or Selling a PCC What is your business worth? … and to who? Grow/Buy/Sell – The Owner’s Dilemma Introduction of Panelists Q1) The Art of the Deal Structure & Process
Q2) The Elephant in the Room is VALUATION
Open Floor for Questions
We ALL Sell - Eventually • By Design – Retirement • Westervelt, Career Canada College, CDI (the original), RCC – Succession (e.g. Hank > Renee Herzing)
– Lifestyle Decisions & Orderly Business Exits • 50 New PCCs and exiting PCCs / Year
• By Necessity – ‘Fire Sale’ – Bankruptcy • Career Academy, Shaw College, OBC, Various TCAF Hits
• We eventually want to Exit on our Own Terms
Strategic Options Entrepreneurial Owners
Status Quo
Growth
Organic
Grow
Acquisition
….
Sell/Transition
Private Equity
Buy
…..
MBO
Strategic
Sell
M&A Game The Players Buyers
• Strategic vs. Financial (Private Equity) • Internal (Family & Management Teams)
Intermediaries
• Bankers & Investment Bankers • Business Brokers
Sellers
• Accountants, Lawyers, Tax Advisors • Friends, Family, Shareholders
Our Panelists • Richard Remillard – Canadian Venture Capital Association (CVCA) – Explain the overall nature of the financial markets (Venture Capital & Private Equity in specific)
• Trevor Gough – CIBC Mid-Market Investment Banking - Managing Director – Explain Bank Debt, Sub-Debt and Mezzanine Financing
• Jason Sparaga – Spara Capital Partners Inc. - President – Explain the role of Investment Bankers in Mergers & Acquisitions
• Jason Berenstein – Kilmer Capital Partners - Principal – Explain Private Equity and what’s important to them
Richard Rémillard
Tel: (416) 487-0519
[email protected]
• Executive Director, CVCA Canada’s Venture Capital & Private Equity Association • Explain the overall nature of the financial markets • Joined CVCA in 2004 as Executive Director • Past President of RCG, a management consulting firm • Previously a VP at Canadian Bankers Association and Special Assistant to the Minister of Finance • Sits on several boards & has taught at Concordia • Graduate of McGill & London School of Economics
• 1,800 members represent the majority of Private Equity companies in Canada • CVCA Members have over $75 Billion in capital under management • 3 major markets (Buyout, Mezzanine & Venture Capital)
Trevor Gough • • • • •
Managing Director, Mid-market Investment Banking Explain Bank Debt, Sub-Debt and Mezzanine Financing Joined CIBC Mid-Market Investment Banking in 2002 Headed the group for the past 6 years Completed many transactions including divestitures, acquisitions, management buy-outs and private placements of debt and equity Tel: (416) 980-7341 • Prior to joining CIBC, Trevor worked for 12 years with an
[email protected] international accountancy firm in their corporate finance and audit groups in Canada and the UK • Chartered accountant designation • Offices in Toronto, Montreal, Vancouver, Calgary and Edmonton. • Provide M&A advice and deal execution targeted at privately-owned Canadian companies. • Typical transaction sizes range from $10 - $100 million.
Jason Sparaga •
President and Founder of Spara Capital.
• Explain the role of Investment Bankers in Mergers & Acquisitions • • •
Tel: (905) 829-5757 x124
• •
Chartered Accountant by training. Highly-entrepreneurial and an experienced deal professional in both M&A and financing. Past President of the Toronto Chapter of the Association for Corporate Growth (ACG). Board member of several public companies. Member of CEO Global Network
[email protected]
• Boutique investment bank and merchant banking firm based in Oakville combining Bay Street Expertise and a Main Street Approach. • Focused on mergers and acquisitions and financings for mid-market private and public, entrepreneur-led businesses. • We fight for entrepreneurs and take pride in our professional tenacity.
Jason Berenstein • • • • • Tel: (416) 815-4984
[email protected]
• • •
Principal with Kilmer Capital Partners Joined Kilmer in 2002 Explain Private Equity and what’s important to them Responsible for new deal origination, investment execution and management Experience with buy-outs, buy-ins, recaps and growth capital investments Prior experience as a VP at Deloitte working in Transaction Services Association for Corporate Growth Board member Chartered Accountant and M.B.A.
• A leader in private equity investments in small to mid-sized businesses undergoing periods of rapid growth, significant change or ownership transition • Funding for management buyouts • Growth capital for entrepreneurs with a vision
Q1) The Art of the Deal Structure & Process • Getting Ready to Deal – Preparedness – Successes, Roadblocks, War Stories
• What to expect? (Goals, Timing, Results) Ontario Greenways Inc. Divestiture Timeline Month 1 Phase 1 - Assessment and Preparation Research and Planning Preparation of Marketing Materials Preparation of Buyer list Phase 2 - Marketing and Negotiation Marketing and Management meetings Negotiating and Finalizing LOI Sign Non-Binding Letter of Intent Phase 3 - Due Diligence, Docmentation and Closing Negotiation & Due Diligence Sign Purchase Agreement, Close and Funding
Month 2
Month 3
Month 4
Month 5
Month 6
Q2) The Elephant in the Room is VALUATION – Market Conditions (Supply & Demand for Capital) ? – Multiplier (x EBITDA or x Revenue) ? – Strategic or Financial Buyer ? – Platform or Add-on Investment ? – Payment Types (Cash, Vendor Note, …) ? – Seller’s Goals (Exit or Change) ?
Q3) Open Floor for Questions
Our Panelists’ Contact Information • Richard Rémillard, Executive Director – Canadian Venture Capital Association (CVCA) • Tel: (416) 487-0519
[email protected]
• Trevor Gough, Managing Director – CIBC Mid-Market Investment Banking • Tel: (416) 980-7341
[email protected]
• Jason Sparaga, President – Spara Capital Partners Inc. • Tel: (905) 829-5757 x124
[email protected]
• Jason Berenstein, Vice President – Kilmer Capital Partners • Tel: (416) 815-4984
[email protected]
