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Acquisitions

Acquisitions


Are you looking to enter the Polish market, or expand your existing operations in Poland? The quickest way is through an acquisition. We can help you achieve your aims. Poland Corporate Finance has extensive experience in assisting international buyers during the entire process of acquiring a company in Poland.

Even for those who already have operations in Poland, we can add value through our focus and detachment. The acquisition process can be very time consuming and a disciplined approach is important to succeed. As in any negotiations, it is always helpful to have an agent acting between principals. We can also provide confidentiality on the identity of the acquirer in the initial approach phase.

For those who do not have a presence in Poland, using our services is even more beneficial.

Our local knowledge, experience and presence means that we can:
  • Advise you on the culture and risks of acquiring in Poland
  • Negotiate effectively on your behalf as required
  • Provide you with detailed information that often only comes with local knowledge and contacts
  • Fix problems quickly and effectively

Whatever your situation, Poland Corporate Finance’s mission is to help companies to achieve their objectives when acquiring a company in Poland.

When considering an acquisition, the acquiring company faces a number of questions:
  • How to find the acquisition target with the best strategic fit?
  • How to approach the acquisition target successfully?
  • Is there a way of getting into an exclusive position of negotiation?
  • What are the realistically achievable synergies?
  • How do we minimize the business risk?
  • Which way is best to buy at the lowest price?

As specialists in mergers and acquisitions, Poland Corporate Finance has gained considerable experience in dealing with all of these complex issues and can give expert advice at every stage of an acquisition process.

We generally split the acquisition process into three distinct phases. However, we recognise that every project is unique and will evolve in its own way. The scheme below is therefore meant to provide guidance rather than a fixed template.

Internal Phase

Defining the acquisition criteria at the beginning of the process can save time and effort later on. Generally, our Clients already have a well-defined acquisition strategy, but if they do not then we can help prepare one. If required, we can organise market research to confirm the assumptions of a strategy.
Based on the acquisition strategy, the profile of the ideal target candidate will be determined. Poland Corporate Finance will prepare a long list of acquisition targets. The list will include a company description, outline financial performance and other key data. We may be able to include some local knowledge, which indicates whether a company might be for sale. In some cases our long list may also include targets, which do not perfectly fit the criteria, but come close to meeting all the major requirements.

Together with the Client, we then select the most promising opportunities based on the long list.


External Phase

The chosen targets will then be approached by Poland Corporate Finance. Usually an approach can be made successfully without disclosing the identity of the Client. For those who are interested in discussing the possibility of an acquisition, Poland Corporate Finance usually has an initial meeting. From this we prepare a short report for the Client. On the basis of these reports, the Client confirms their interest after which we arrange a visit for the Client. Where there are multiple targets, we will try to get several meetings in one visit to Poland.

Since ‘you only make a first impression once’, the initial meeting is very important for both the target and the Client. We carry out any prior preparation required to maximise the chances of it being a success.
We will then help with any follow-up to the initial visit. The requirement depends on the circumstances, but a common sequence is:

  • A request from the Client for further information, usually from the target, but sometimes general market information. We request, collect, analyse and present this to the Client.
  • A visit by the potential target to the Client’s head office or one of their sites outside Poland. This gives the Client an opportunity to get to know the target’s owners and managers better, to explain the benefits of the acquisition to the target better, and to discuss future mutual plans.
  • Valuation. Polish sellers usually require an indication of valuation before proceeding any further in the process. We can advise on a value bandwidth for the indicative acquisition offer.
We will then provide every assistance in getting an agreed deal. We are happy to carry out negotiations as per the Client’s instructions, or support the Client in their own negotiations. We fully understand that the deal is more than just a price - the conditions and future involvement of key management are but one example of a crucial issue that often arises at this stage. The deal is usually formalised though a Letter of Intent. Negotiating and signing a Letter of Intent is an important milestone during the acquisition process. Letters of Intent come in various forms, varying from a one-pager describing the general terms of the intended transaction to a detailed agreement dealing with almost all issues that will appear in the final Share Purchase Agreement. We usually recommend the simpler approach.

An important function of the Letter of Intent is to secure an agreed Exclusivity Period.


Exclusivity Phase

Having signed the Letter of Intent, the next step is generally for the buyer to carry out Due Diligence to confirm that the target is as presented. Accountancy and legal aspects are inevitably important, and some buyers may also want to look into other areas, be they environmental, commercial or technical. Sometimes the buyer may carry out some aspects with an in-house team.

We usually project manage the process on the Client’s behalf. Poland Corporate Finance can also recommend accountancy, legal and other firms to conduct due diligence. If required, we can collect and negotiate offers with local providers.
If necessary, we can support you in arranging external debt and/or equity financing in Poland.
The final action is usually the negotiation of the Share Purchase Agreement. Although much of the work is carried out by the lawyers, we are usually closely involved as many of the aspects are commercial.
Of course, a key part for us is Remuneration. We require some form of fee during the above process, usually an agreed monthly retainer, but a time based fee is possible. However, the majority of our Remuneration is based on a Success Fee payable once the Share Purchase Agreement is closed.

Poland Corporate Finance Sp. z o.o. is an independent financial advisory firm that is affiliated with Oaklins International INC.
For details of the nature of this affiliation and other legal notices, please refer to www.oaklins.com