Making Strategic Acquisitions

Valuing Synergies and Identifying Potential Pitfalls in a $15 Billion Takeover Bid

A large industrial products company was contemplating a major acquisition. Before the launch of discussions with the target company, Newry provided extensive background to the acquisition team, developing comprehensive profiles of the candidate's manufacturing facilities, distribution capabilities, product development/technology capabilities, and corporate organization. The depth and detail of the information Newry provided enabled the acquiring company to value potential synergies with a high degree of accuracy.

A Process to Identify and Evaluate Acquisition Targets

A large consumer hardware business serving the new construction and retrofit residential market sought acquisitions that would expand its product portfolio and provide rapid growth. Dissatisfied with the companies and products in their acquisition platform, they asked Newry to help them build a more robust one and an ongoing approach that would be more systematic and strategic. Newry first helped them articulate their acquisition criteria and their platform requirements (i.e., product types and company characteristics). We then organized the products into functional domains and populated the domains with over 500 companies supplying the products. To determine the most attractive functional domains, we developed a technique for the client to identify the most profitable companies and the domains in which they participated. As a result, our client had a rigorous process that senior management supported, and they pursued several of the opportunities identified.