Latest / Best of LinkedIn: Strategy, M&A & Investments / Best of LinkedIn: M&A Insights CW 33/ 34

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Best of LinkedIn: M&A Insights CW 33/ 34 · Best of LinkedIn: Strategy, M&A & Investments

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  Speaker 0: provided by Thomas Allgaier and Frenus, based on the most relevant LinkedIn posts about M&A insights in calendar weeks thirty-three and thirty four.
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  Speaker 0: Frenuse is a B to D market research company supporting m&a consultancies with the marketing competition perspective for example in commercial due diligence's cdc CDD engagements.
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  Speaker 0: You can find more info in the description.
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  Speaker 1: so imagine running a seven hundred forty-seven million dollar transaction and deciding you just don't need Wow, right.
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  Speaker 1: I mean that's exactly what CVC capital just did and it is absolutely sending shockwaves through you know traditional advisory firms.
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  Speaker 0: Yeah We are definitely diving into the raw reality of M&A today setting the expectations here.
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  Speaker 0: we're unpacking The top trends dominating professional networks Right now so from the actual mechanics of AI driven deal making to Macro capital flows in even deep niche roll-ups.
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  Speaker 1: yeah.
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  Speaker 1: And that cvc deal.
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  Speaker 1: i mean It's the perfect place to start.
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  Speaker 1: We're seeing this intense collision right at the beginning of the deal lifecycle, it's pure speed and new tech just crashing into traditional relationship-heavy advisory model.
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  Speaker 0: Absolutely There was a fantastic point raised recently by Keegan Caldwell about exactly this Compressed deal.
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  Speaker 0: timelines are fundamentally redefining how buyers have to evaluate risk.
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  Speaker 1: Right due diligence is accelerating breakneck pace.
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  Speaker 0: Exactly, and to put the mechanics of that speed into perspective let's look at that massive example you just mentioned which was broken down by Jeremy B Hill.
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  Speaker 0: so CVC Capital.
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  Speaker 0: they've got a hundred eighty billion under management and they sold a Greek e-commerce company to Blackstone for seven hundred forty seven million.
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  Speaker 0: And
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  Speaker 1: no sell side bankers?
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  Speaker 1: None
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  Speaker 0: no coverage teams at all.
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  Speaker 1: They completely bypassed the traditional playbook, I mean instead of standard information memorandums or you know heavily managed management presentations buyers were just given access to a data portal and it was equipped with a real-time AI chatbot trained on the company's financial diligence.
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  Speaker 0: that's wild yeah.
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  Speaker 0: so any complex issues we're just routed into the management team directly
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  Speaker 1: to management.
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  Speaker 1: yet CBC kept roughly nine million in advisory fees they would have normally paid out.
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  Speaker 1: Nine
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  Speaker 0: million, wow!
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  Speaker 0: I mean i look at that and think of the AI as this infinitely fast data room clerk like a clerk can organize ten thousand PDFs.
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  Speaker 0: five seconds you know.
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  Speaker 0: index every lease agreement flag missing signatures sure but a clerk cannot tell you if the target company c-suite secretly hates each other or if the culture is toxic enough to trigger a mass exit as post-close.
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  Speaker 1: Right
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  Speaker 0: So, If a chatbot's doing financial Q&A The liability and narrative control shift entirely into management team?
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  Speaker 0: I guess this question does make traditional advisors obsolete?
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  Speaker 0: Or just force them upmarket?
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  Speaker 1: Well it overblown.
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  Speaker 1: AI is undoubtedly automating the data structuring, sure.
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  Speaker 1: But if we look at the insights from her Expringer... ...the underlying fundamentals of what makes an asset attractive haven't changed a bit.
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  Speaker 1: Acquirers are still deploying capital to capture hard-to-rebuild customer relationships.
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  Speaker 1: you know deeply embedded operational workflows and proprietary datasets
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  Speaker 0: Right!
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  Speaker 0: And AI might accelerate Reading a data room, but it doesn't generate the enterprise value inside.
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  Speaker 1: Exactly and Mary Joyce brought up a crucial layer to this.
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  Speaker 1: She pointed out that possessing data is not a moat.
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  Speaker 1: The true structural mode comes from owning the actual process through which that data Is transformed into strategic decisions?
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  Speaker 1: That
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  Speaker 0: makes a lot of sense
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  Speaker 1: And we see that reality reflected in the market data too.
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  Speaker 1: Brian Pinto shared a recent Deloitte survey of five hundred deal makers and it found ninety percent Jenny I adoption across M&A activities.
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  Speaker 0: Wow, ninety percent.
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  Speaker 1: Yeah But the overwhelming consensus from that same group is that human judgment remains irreplaceable You know for the actual nuances of negotiations structural risk assessment things like that
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  Speaker 0: Which means navigating this accelerated environment requires just an absurd amount of human preparation.
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  Speaker 0: You can't just unleash a Gen AI tool onto a sloppy unstructured data room and expect to clean diligence report.
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  Speaker 1: Oh, absolutely
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  Speaker 0: not!
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  Speaker 0: Take a look at the strategy Kiesan Patel highlighted from Jeremy Segal.
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  Speaker 0: He regularly executes a thirty-day close.
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  Speaker 1: Thirty days is incredibly fast Right
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  Speaker 0: And closing in thirty days only works through aggressive pre-LOI front loading.
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  Speaker 0: He demands one page question set An anonymized employee census a full financial pack, an evaluation model before exclusivity is even granted.
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  Speaker 1: So the speed is entirely earned before the clock ever starts?
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  Speaker 0: Exactly!
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  Speaker 0: But that preparation gap is incredibly dangerous particularly for cell-side founders.
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  Speaker 1: Yeah, Tula Khan or Demi made a brilliant observation about this.
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  Speaker 1: information asymmetry heavily punishes first time.
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  Speaker 1: sellers think about it.
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  Speaker 1: A private equity fund has executed dozens of transactions This year alone.
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  Speaker 1: they know exactly which EBITDA add backs will hold up under quality of earning scrutiny and how to legally structure earnouts to protect their downside.
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  Speaker 1: The seller, on the other hand is usually doing this for the very first
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  Speaker 1: time.".
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  Speaker 0: That structural disadvantage is huge!
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  Speaker 0: It's why Anna Rusathia argues that closing a PE deal effectively now requires ten or more specialist advisors—you've got tax environmental risk legal operational diligence.
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  Speaker 0: you just can't afford to get blindsided on a nine-figure exit because
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  Speaker 1: Founders are definitely waking up to this, but you know their criteria for hiring those advisors is shifting.
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  Speaker 1: Brian Dukes points out that founders no longer just want bankers trained on generic financial frameworks.
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  Speaker 1: What're
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  Speaker 0: they looking for now?
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  Speaker 1: They demand advisors with actual sector operating experience people who have built scaled and exited businesses in the highly specific industry.
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  Speaker 1: The days of winning a mandate through warm text intro are largely over
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  Speaker 0: Especially high stakes arenas Like the creator economy, where valuations routinely cross the one hundred million threshold.
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  Speaker 0: Chris Rumin notes that formal bake-offs are completely replacing old network driven handshakes.
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  Speaker 0: Boards and banks are literally flying in for intense live presentations.
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  Speaker 1: It all circles back to exit readiness.
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  Speaker 1: Carrie Rabishah Yassir Gadid out in Dubai And Jake Tobin down in Florida have all been hammering this identical warning.
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  Speaker 1: Readiness gaps destroy enterprise value long before a teaser is ever drafted.
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  Speaker 0: Right, weak documentation unresolved tax exposures or business that relies entirely on the owner's personal relationships.
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  Speaker 0: That's going to cost you dearly at the negotiation table
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  Speaker 1: And profitability does not equal readiness.
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  Speaker 1: Joshua Novick shared perfect example of this.
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  Speaker 1: He pointed out that a sellable business doesn't just mean good business.
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  Speaker 1: It means there an active pool buyers right now willing pay your clearing price.
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  Speaker 0: Didn't he mention specific restaurant chain?
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  Speaker 1: Yeah, he actually had to turn down a mandate for a highly profitable restaurant chain generating one point five million euros in EBITDA.
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  Speaker 1: Just because the buyer universe of that specific asset class was dormant!
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  Speaker 0: That is a bitter pill for a founder to swallow.
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  Speaker 0: but Kai Hesselman warns that letting ego drive the process and refusing to accept realistic valuation early on often leads to catastrophic alternative which is liquidation.
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  Speaker 0: Yeah, when you factor in paying out severance unwinding commercial leases and auctioning off machinery for a fraction of book value liquidation almost always costs far more than simply taking that initially done.
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  Speaker 0: appointing M&A offer.
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  Speaker 1: So the tactical question becomes how do you maximize leverage to avoid that scenario?
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  Speaker 1: Michael J Blankenship advocates for the engineered exit.
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  Speaker 1: so preparing a dual track IPO in parallel with the m&a process interesting it physically creates The competitive tension required to force financial sponsors to pay a premium.
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  Speaker 0: But see, if speed and preparation dictate the process.
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  Speaker 0: What happens when buyers get blinded by the momentum of winning that deal?
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  Speaker 0: Because all this hyper prep in competitive tension from dual track IPOs creates a massive trap on the buy side.
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  Speaker 0: That brings us to valuation traps And diligence blind spots.
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  Speaker 1: It's huge issue.
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  Speaker 0: I mean there is a staggering statistic floating around right now From Addisela Ajibola.
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  Speaker 0: losing bidders often outperform the winners in the long run.
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  Speaker 1: Wait, really?
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  Speaker 0: Yeah and furthermore only thirty percent of strategic acquisitions actually hit their internal performance targets.
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  Speaker 1: wait so The secret to M&A is just losing the auction.
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  Speaker 1: like how do we avoid the winner's curse?
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  Speaker 0: well Michael Rosenberg hits this perfectly.
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  Speaker 0: post-close decisions protecting culture retaining talent they matter far more than whether you paid seven X or eight X EBITDA Right.
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  Speaker 0: You can negotiate a flawless entry price and completely destroy the value within six months of integration.
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  Speaker 0: Furthermore, focusing purely on EBITDA during diligence could be a dangerous illusion anyway.
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  Speaker 0: Oh absolutely
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  Speaker 1: Armando Zucali highlighted a fascinating breakdown of the luxury group OTB's financials
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  Speaker 0: The fashion group right?
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  Speaker 1: Exactly So.
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  Speaker 1: they reported a two hundred thirty seven point three million euro EBITTA Which sounds incredibly healthy But their actual EBIT earnings before interest in taxes was just ten point one million.
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  Speaker 1: Wow,
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  Speaker 0: Just ten million?
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  Speaker 0: Yeah
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  Speaker 1: that is a massive gap!
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  Speaker 1: You can't pay your senior debt service with theoretical EBITDA you pay it with actual cash flow.
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  Speaker 1: if That Gap Is Driven by Depreciation or Massive Exceptional Items It Fundamentally Questions How Much Real Operating Leverage You Actually Acquire.
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  Speaker 0: and it is those hidden operational realities that ruin closings Cabot Earl flags for specific reasons.
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  Speaker 0: Working capital becomes a massive dispute right before the wire hits, it's usually undefined targets in the LOI.
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  Speaker 0: If you don't nail down exact calculation mechanics early You're guaranteed to six-figure argument that can derail entire timeline.
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  Speaker 1: And finance is just one minefield.
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  Speaker 1: Technical and legal blind spots are equally fatal.
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  Speaker 1: Richard G emphasizes that deep technical due diligence is what actually determines project bankability for lenders.
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  Speaker 0: And Robert Plotkin warns that ignoring a patent portfolio until the LOI stage guarantees risk discounts and warranty exposure, plus Joris Kirsten notes that it targets CAPEX.
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  Speaker 0: policy nuances drastically impact long-term value creation.
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  Speaker 1: But if we're talking about pure deal breakers, nothing blows up in integration quite like IT.
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  Speaker 1: Martina Trojakova breaks IT carveouts into three very distinct species.
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  Speaker 1: Let
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  Speaker 0: me guess none of them are fun?
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  Speaker 1: Well there's the nice carve out where systems are already independent.
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  Speaker 0: Okay that's not bad.
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  Speaker 1: Then there's the spaghetti carve out where the target is deeply technologically entangled with its parent company and The build it carve-out, Where the buyer literally lacks the infrastructure to house.
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  Speaker 0: Oh man
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  Speaker 1: She warns that signing a TSA A transitional services agreement without mapping That underlying IT architecture Is operational suicide Right
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  Speaker 0: before we look at how To actually integrate these companies Without breaking them.
• 10:51
  Speaker 0: Just a quick reminder to subscribe to the feed So you don't miss our upcoming deep dives Into PE value creation exit strategies.
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  Speaker 1: Because once the ink is dry and you've somehow survived that IT carve out, or you execute a hybrid rebrand.
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  Speaker 1: And whatever path you choose, Steven Patscott adds that HR leaders must follow five golden rules for navigating cultural
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  Speaker 1: tension."
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  Speaker 0: But when get the alignment right it is incredibly powerful.
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  Speaker 0: Genelabber pointed out that ASMPT's NenexX divestment to applied materials succeeded entirely because of deep mutual trust and cultural alignment.
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  Speaker 1: Yeah...that was textbook win!
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  Speaker 0: but let me ask here this is seamless integration?
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  Speaker 0: just myth?
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  Speaker 0: yeah Is ever that peaceful?
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  Speaker 1: Honestly It's often brutal.
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  Speaker 1: We have to acknowledge the human cost here.
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  Speaker 1: Jack Schwunghau reports that Sanofi is cutting two hundred and twenty-nine blueprint medicines jobs post their nine point one billion dollar acquisition just To reprioritize pipeline assets,
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  Speaker 0: that's rough.
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  Speaker 1: And it's not just headcount.
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  Speaker 1: Archie Samson notes That The Big Four Consulting Arms which rebuilt aggressively via M&A are now facing intense regulatory pressure to divest again.
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  Speaker 0: Wow which is why Frank Aquila reminds us to be aware of survivorship bias.
• 12:25
  Speaker 0: We constantly study the unicorn's finish line rather than the initial market conditions that made them successful in first
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  Speaker 0: place.".
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  Speaker 0: Exactly,
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  Speaker 1: so we've looked at micro level.
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  Speaker 1: integrating single companies now let zoom out into macro data where strategic capital actually flowing globally?
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  Speaker 0: The volume trends are fascinating.
• 12:42
  Speaker 0: Despite high funding costs, Mitch Berlin, Tim Creasy and Josh Putnam showed that acquisition premiums are incredibly stable across decades.
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  Speaker 1: Buyers haven't reset their willingness to pay for premium assets?
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  Speaker 0: Not at all!
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  Speaker 0: Cape Haldesey reports UK in-gon public M&A has doubled to seventy seven billion dollars And Tarun Agarwal notes India's deal value rose eighteen percent to a hundred twenty three point eight billion even as deal volume fell.
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  Speaker 1: Bigger Beals
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  Speaker 0: Exactly Plus, Brad Watson highlights strong momentum in the Mene region.
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  Speaker 1: When we spotlight sector-specific multiples The picture gets really sharp.
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  Speaker 1: Dirk Solmer notes, saw steals are clearing at a four point zero x median multiple with vertical saws taking market share.
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  Speaker 0: And outside of software
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  Speaker 1: Natalie Ohana points out that industrials are quietly holding twenty percent of global M&A deal volume.
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  Speaker 1: and in life sciences Kyla Huchik reveals biotechs are increasingly using reverse mergers.
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  Speaker 1: we've seen seventeen this year nearly rivaling the nineteen traditional IPOs.
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  Speaker 0: but there is no sector running hotter right now than cybersecurity.
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  Speaker 0: Cole Grolmes' flag sire has unprecedented one billion dollar acquisition of Oasis security.
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  Speaker 0: That's an estimated fifty x to a hundred X AR multiple for five-year old buyer.
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  Speaker 1: A hundred times ARR, that is just wild!
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  Speaker 0: Dominic Perry tracked a hundred July cyberdeals worth roughly four billion dollars and Eric McAlpine notes strategic now drive eighty six percent of Cyber M&A.
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  Speaker 0: But Pramod Gosavi highlights Fortinet's unique strategy here.
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  Speaker 1: Oh, what are they doing?
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  Speaker 0: Instead of paying massive venture premiums They buy distressed low revenue assets with strong tech and integrate them into their own distribution engine.
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  Speaker 0: It's a totally different playbook.
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  Speaker 1: I love that.
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  Speaker 1: And you see this massive consolidation across the board.
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  Speaker 1: We've seen a wave of landmark mega deals just to show market breadth.
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  Speaker 1: Julie Stanley highlighted Grant Thornton buying CBIZ for five billion.
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  Speaker 1: Natasha Mescurran has covered Stripe acquiring Open Router for over seven billion, and Phillips Matthew noted the twenty-one billion euro merger between Saipim and Subsea Seven is facing EU pushback.
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  Speaker 1: Plus Alistair Matchett covered Goldman Sachs buying LCN Capital for four hundred ten million.
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  Speaker 0: And The regional movements are just as fast.
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  Speaker 0: Antoine Dabini, Alan Sheehan & Richard Denney discussed Deloitte advising on a nine hundred million Euro BMC Kings Band deal along with the Vittag transaction.
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  Speaker 1: Wait, what about Brentag?
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  Speaker 1: Weren't they doing something in South Korea?
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  Speaker 0: Yeah.
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  Speaker 0: Gus Desmond noted Brentag acquiring Woojin and Doug Woodburn covered Red Squids B Corp MSP acquisitions.
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  Speaker 0: Martin Gallus shared Maguire Capital taking a stake In Schlafener Heis.
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  Speaker 0: And if you want context for all this Reza Zahiri looked at Medtronic's targeted M&A history to show how these cycles play out.
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  Speaker 1: You know, it's easy to get lost in billions and tech multiples but massive wealth and scale are being generated quietly in the lower middle market.
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  Speaker 0: Right?
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  Speaker 0: The main street roll-ups.
• 15:31
  Speaker 0: Ben Kelly broke down acquiring a one point two million dollar car wash with an SBA seven A loan.
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  Speaker 0: he used ninety percent debt and investor for that ten percent down allowing him operated.
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  Speaker 0: generate cash flow was zero personal capital
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  Speaker 1: incredible leverage.
• 15:46
  Speaker 0: yeah It sounds like no money down commercial real estate flipping.
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  Speaker 0: but is the risk profile wildly different?
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  Speaker 1: It requires relentless operational execution for sure.
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  Speaker 1: But Adam Coffey shared a similar leverage story, one million in equity to buy four million insurance agency that eventually sold for twelve million.
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  Speaker 1: and Greg Headnotes operators are buying industrial businesses at eight X-to-twelve X EBITDA heavily utilizing twenty to thirty percent earnouts.
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  Speaker 0: Private Equity recognizes the arbitrage here.
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  Speaker 0: Joe Lewin notes that fifteen platforms backed by firms like Blackstone and Carlisle have quietly bought over four hundred eighty fire safety businesses.
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  Speaker 1: Yet no platform has crossed the Atlantic yet!
• 16:22
  Speaker 1: Right,
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  Speaker 0: furthermore Robert Johnson highlights that M&A isn't just an exit minority.
• 16:26
  Speaker 0: business enterprises are using it as a disciplined path to scale...and a brief nod to community making all this happen.
• 16:33
  Speaker 0: Josh Calderon's Bicide mandates, Ryan Berning's Southside closes.
• 16:37
  Speaker 0: David Bishop's Gray does deal and Jean-Christophe Urgoyen.
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  Speaker 0: new bicide M&A practice
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  Speaker 1: Plus all the events driving this
• 16:44
  Speaker 0: Exactly!
• 16:45
  Speaker 0: The Becker Bicides Summit with Jeff Aplan Martin Boroscoe & Michael Bartels.
• 16:49
  Speaker 0: Crossborder ACC Events hosted by David Edgar And Ermer F. Gevins Nurbergring.
• 16:54
  Speaker 0: M&a Networking so much momentum.
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  Speaker 1: You know, we started by talking about AI running a seven hundred and forty-seven million dollar transaction without a banker but ended up with the unautomated reality of fire safety inspections in specialized car washes.
• 17:06
  Speaker 1: as AI commoditizes the process of deal making The true premium in M&A will shift entirely to niche gritty operational expertise.
• 17:14
  Speaker 0: If you enjoyed this deep dive new deep dives drop every two weeks.
• 17:18
  Speaker 0: Also check out our other editions on PE Value creation PE exit strategies, venture capital private equity fundraising and strategy in consulting.
• 17:27
  Speaker 0: Thanks for listening.
• 17:28
  Speaker 0: don't forget to subscribe!