“Be very careful what you are looking at [when considering a company’s financial performance]. The 2022 numbers may be an aberration – it is not an expectation of future performance. Do an analysis and get help from a financial professional who can do due diligence on the financial side. Come up, ultimately, with a [deal] structure that is fair to the buyer and the seller.” – Bill Wiersema
Bill Wiersema is an Audit Principal with Miller, Cooper & Co., specializing in M&A financial due diligence, and author of several books on finance. His experience has a global reach as he has assisted international entities with their locations in Asia, Europe, and Latin America. His clients include middle-market companies, private equity groups, and financial institutions. Bill has extensive experience in assisting sellers across diverse industries in preparing for sale, conducting due diligence, creating business plans and projections, assisting in negotiations with financial institutions, and advising clients on post-acquisition financial issues.
Bill is a frequent speaker, presenter, and contributor for various organizations and publications, including the Alliance of M&A Advisors (AM&AA) and the Chicago Bar Association. He is a graduate of Economics from Northwestern University, and before joining Miller, Cooper, Co., he was a Graduate Fellow in Accounting at the University of Illinois. Bill serves on the Midwest Chapter Committee of the AM&AA. He is a member and has served on the Board of Directors of the Association for Corporate Growth (ACG) and the Midwest Business Brokers and Intermediaries. He is a member of the AICPA and the ICPAS.
- How has the three-year pandemic impacted companies’ performances? [2:14]
- Are there permanent changes in how business is conducted based on the pandemic? [7:09]
- How will higher interest rates continue to affect M&A activity? [9:40]
- Do buyers in the middle market rely on sentiment or data when they are making investment decisions? [14:01]
- In a down environment, what impacts multiples for strategic and financial buyers? [17:45]
- What impact did supply chain issues have on valuations, and to what degree can adjustments be made based on these unusual issues? [19:59]
- Predicting future cash flows is highly subjective, so how is that impacting valuations in an uncertain environment? [24:37]
- Do most buyers assume that things will settle back to pre-pandemic levels? [26:56]
- Is the M&A market likely to return to pre-pandemic norms, or will new norms emerge? [29:16]
- What is the take-home message for the listeners? [32:05]
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Acronyms or Terms Used in This Episode
- Price Volume Mix Analysis: Price Volume Mix Analysis is a method used to evaluate changes in a company’s revenue by analyzing the impact of price changes, volume variations, and product mix shifts on overall sales.
- SKU (Stock Keeping Unit): An SKU is a unique identifier assigned to a specific product or item in a company’s inventory, allowing for precise tracking and managing of individual items.
- PPP Program (Public-Private Partnership Program): A PPP Program is a collaborative arrangement between government entities and private sector organizations to jointly finance, develop, and operate public infrastructure projects or deliver public services.
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