Mergers and Acquisitions
Mergers and acquisitions (M&A) are transactions in which the ownership of companies, other business organizations, or their operating units are transferred or consolidated with other entities. M&A are both aspects of strategic management, corporate finance, and management dealing with the buying, selling, dividing and combining of different companies and similar entities, which can allow enterprises to grow or downsize, and change the nature of their business or competitive position.
From a legal point of view, a merger is a legal consolidation of two entities into one, whereas an acquisition occurs when one entity takes ownership of another entity's stock, equity interests or assets. From a commercial and economic point of view, both types of transactions generally result in the consolidation of assets and liabilities under one entity, and the distinction between a "merger" and an "acquisition" is less clear.
A transaction legally structured as an acquisition may have the effect of placing one party's business under the indirect ownership of the other party's shareholders, while a transaction legally structured as a merger may give each party's shareholders partial ownership and control of the combined enterprise. At SCMO, we specialize in M&A of assets and companies in the following segments of the logistics, transportation, and supply chain management sector:
Sea-ports and dry ports
Special economic zones
We are operational all over the world, and strongly specialize in projects belonging to the Belt and Road Initiative (BRI), from an informed perspective, having actually written the book on Transportation and the Belt and Road Initiative, which lists all 743 BRI projects up to 31.12.2018 in 84 countries amounting USD 1 trillion, with an average project's size of USD 1.3 billion. We can identify projects as well as investors and buyers, when necessary. We are also open to handle projects outside of BRI's deployment framework. We only consider assignments on a retained basis.
Understanding your project
Acceptation of your project
Discreet identification of targets that match your project’s criteria
Approach of those targets
Project’s introduction to targets
Valuation of project/ target (with sometimes the help of a specialized valuation company)
Negotiation facilitation (with sometimes the help of a corporate finance advisor)
Structuring of a deal (with sometimes the help of a corporate finance advisor)
Drafting of legal agreement (with the help of a specialized law firm)
Signing of legal agreement
We understand that a M&A deal is only as good as its integration is successful or, in other words, in the success of two companies’ actual merger of both management, finance and accounting, commercial, and operations. We consider it as a “life or death” matter, which will result in the M&A having been an excellent operation, while a failure may result in both parties’ consequent loss of competitiveness, efficiency, financial reserves, and even sometimes resulting in bankruptcy. SCMO specialists are expert in M&A integration.
We are also open to remain connected with client for the long term either in a strategic capacity or in a technical capacity. Both our expertise may be put to good use, as well as our connections in the logistics, transportation, and supply chain management sectors. Due to our numerous projects and assignments related with logistics towards many other industries, we are also rather conversant and relatively knowledgeable in those industries, which can sometimes be helpful.
Depending on the nature of your project, we may deliver some of these services directly and by using only in-house resources. For some other projects, we may choose to work with strictly selected partners to fulfill our assignments as required, and according to best-in-class standards. Depending on the specifics of the project, we will associate with the following firms in their respective areas of expertise:
Corporate finance advisors
Initial public offering (IPO) specialists
The following case studies demonstrate how SCMO approach has been successfully applied to client issues.
Military & security
Special economic zones
Governments & administrations
A shipyard asked SCMO to help them find urgent financing for USD 200 million to disengage from derivatives debt exposure. We promptly found an investor that was willing to invest and become partly shareholder and partly lender, allowing restructuring the shipyard exposure. This saved the shipyard from bankruptcy, and was executed to the satisfaction of both client and the investor.
A Chinese State Owned Enterprise (SEO) asked SCMO to help them find projects among the Belt and Road Initiative countries related with logistics, transportation, and supply chain management. We introduced a logistics park and a special economic zone. We led the introduction, negotiation, and legal agreement drafting and signature, to the satisfaction of client. This assignment is still open for further potential projects.
A French tiers 2 airport came to SCMO with the request to help them find Asian investor(s) that could also help them jointly operate the airport and find a corresponding customer base. We successfully introduced a Chinese party, which went forward with the investment as well as with the corresponding cargo handling volume.
A Chinese airport asked SCMO for help, when they wanted to position themselves as a backup airport for Hong Kong airport. We introduced the right parties at the level of Hong Kong airport and Hong Kong administration, which resulted in that airport now being one of Hong Kong airport's backup airports in case of need.
A local British freight forwarding company asked SCMO for help in finding a suitable buyer due to the retirement of the founder and owner. We helped them prepare their company presentation, and presented them with a shortlist of potential buyers. Negotiations were led with the most promising candidates, one of whom made the acquisition. The past owner remained in the company for a further 5 years, period during which part of the acquisition settlement was paid, linked to the results of the company. Both client and the buyer have been very satisfied of this transaction.
A regional freight forwarding company came to SCMO for help in finding a suitable and complementary partner before executing an IPO. We have been introducing a few candidates to date, without success, as well as another corporate finance specialist. This assignment is still open.
A global freight forwarder approached SCMO with the interest to acquire any complementary potential target, such as another freight forwarder, a trucking company, a warehousing company, or even some more specialized project cargo specialist, removal company, art transportation specialist, valuable transportation specialist, or exhibition specialist. We have been introducing and closing successfully a few of those acquisitions in the past few years. This assignment is still open.
A Central Asia strongly diversified transportation and logistics holding company approached SCMO for help in finding a global freight forwarding partner. The aim of this partnership is primarily to educate client to international logistics standards, with an investment option, which would allow the global partner to become co-owner and stakeholder in the holding company. This assignment is still open.
SCMO was called by one of the world's largest freight forwarders for the integration in Asia Pacific of another of the world's largest freight forwarders that had just been acquired. The reason for calling upon external resources is due to SCMO integration experts' excellence, who did a very good job. Client has been very satisfied with SCMO performance in this integration, which was successful.