Corporate Finance in Atlantic Canada

Commentary on corporate finance issues for small- & mid-market private companies in Atlantic Canada

Posts Tagged ‘selling your business

Acadian Maple sold

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https://www.thechronicleherald.ca/business/local-business/authentic-seacoast-acquires-acadian-maple-345788/

The Chronicle Herald is reporting that Authentic Seacoast has acquired Acadian Maple Products from the Allaway family.

Acadian Maple is a Halifax-based supplier of maple products, including its popular-with-bus-tours Tantallon retail location.

Authentic Seacoast is a Guysborough-based collection of businesses owned by Glynn Williams.  Williams is well reported as the Toronto businessman who fell in love with Guysborough and has been active in building food & beverage businesses in the town. http://authenticseacoast.com/meet-glynn/

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Written by Dan Jennings

August 28, 2019 at 12:05 pm

Different types of buyers

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In general, there are 3 groups/types of buyers for mid-market private businesses:

  1. Strategic.  Such buyers are often called industry buyers because they are typically in the same (or related) industry as the target.  These buyers tend to be larger companies seeking to consolidate your business with their existing operation, and so, they often have access to synergies from combining the two businesses.  These synergies can mean that such buyers can afford to pay more than the below types of buyers (i.e. they can pay a strategic premium over/above standalone financial value).  These buyers are often an option for mid-market businesses and less so for small businesses, but that can depend on the industry.
  2. Financial.  Financial buyers are aplenty in the Atlantic marketplace, given the prevalence of debt and equity capital.  These buyers have access to capital and either financial or management expertise, but aren’t currently operating in the industry of the target (and therefore don’t have synergies to allow them to pay the above premium price).  Such buyers range from formal private equity funds (such as the Sobeys/McCain-founded SeaFort Capital), to informal groups of owners seeking to invest in businesses and their management teams, to individuals who have a dream of being an owner (and have never acquired a business before).  In today’s market, there are many more financial buyers than business opportunities, and so these buyers/investors are looking in almost all industries and sizes in Atlantic.
  3. Management.  Existing employee or senior management groups have always been an option to acquire your business.  Historically, the challenge was often that such buyers didn’t have capital, and so often required significant vendor financing assistance.  In recent years, that is no longer the case, due to the availability of capital (both debt and equity) to assist management teams in acquiring the businesses they work for.  While management buyers can’t do the above strategic price, they can pay a fair price and therefore are a credible alternative.

Stay tuned for more blog entries on each type of buyer.

Written by Dan Jennings

June 12, 2019 at 9:23 am

Cabco Communications sold

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https://www.thechronicleherald.ca/business/cabco-communications-sold-to-local-investors-307611/

The Chronicle Herald is reporting that Dartmouth, NS-based Cabco Communications Group has been sold to a group of local investors, led by Jim Mills (CEO of Halifax-based Office Interiors).  Cabco is a cabling & technology equipment sales, installation and service provider.

This is another example of the type of financial buyer I have spoken/written about many times.  In many sectors, private equity (or informal private equity in the form of a group of investors, in this case) has become a strong & credible alternative to ‘traditional’ industry/strategic acquirers.

Congratulations to majority owner Craig Meredith on his succession and exit!

Written by Dan Jennings

May 2, 2019 at 8:42 am

Conquest Engineering acquired

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https://www.thechronicleherald.ca/business/cbcl-acquires-conquest-engineering-265070/

The Chronicle Herald is reporting that Halifax-based CBCL Ltd has acquired Conquest Engineering Ltd of Saint John, NB.  As is common with many engineering firms, both are said to be employee-owned.

This continues the consolidation trend in the engineering industry.

Written by Dan Jennings

December 4, 2018 at 11:41 am

Edible Matters restaurant deal

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https://www.thechronicleherald.ca/business/local-restaurant-edible-matters-gobbled-up-248996/

The Chronicle Herald is reporting that the Hammond Plains restaurant/bar Edible Matters has been sold.  The Webber family sold to the Doherty family, which owns the Old Triangle bars throughout the Maritimes.

Written by Dan Jennings

November 23, 2018 at 2:13 pm

Business succession in NL

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https://soundcloud.com/vocm/sept-1st-greg-london-dan-jennings-of-bdo-valuing-your

On a recent VOCM radio show in NL (hosted by BDO partner Nancy Snedden), tax colleague Greg London and I talk in-depth about the challenges of business succession in NL.  We covered a wide variety of topics, such as demographics, taxes, the buyer landscape and more.

Written by Dan Jennings

October 26, 2018 at 1:34 pm

More insurance broker consolidation

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http://thechronicleherald.ca/business/1558403-long-standing-independent-brokerages-merge

The Chronicle Herald is reporting that Antigonish Insurance and AA Munro Insurance (both Antigonish, NS-based insurance brokers) are merging.

This continues the consolidation trend in the P&C insurance brokerage industry.

Written by Dan Jennings

April 3, 2018 at 9:15 am