Maintaining and creating corporate value through M&A — but how?

Before markets could get used to the “new normal” after a good two years of pande­mic, geopo­li­ti­cal crises are adding to the uncer­tain­ties and forcing entre­pre­neurs around the world to deal with ongo­ing supply chain issues, rising infla­tion rates, and expec­ted fiscal and mone­tary policy respon­ses, inclu­ding on the cost of capi­tal. The chal­lenges are too funda­men­tal to duck out of sight and hope for better times; to make matters worse, there are also the pres­su­res of digi­tiza­tion and signi­fi­cantly increased envi­ron­men­tal, social and gover­nance (ESG) hurd­les that must also be overcome.

First of all, I recom­mend a ruthl­ess stock­ta­king of the company with an all-round view of all chal­lenges but also oppor­tu­ni­ties, inclu­ding the capi­tal requi­re­ments and possi­ble perspec­ti­ves for the entre­pre­neur and family, and in doing so to play through various scena­rios, for exam­ple: (acqui­si­tion) purchase or (partial) sale or merger? The only thing that seems certain to me is that active play­ers will have more oppor­tu­ni­ties and pros­pects than reac­tive play­ers, who in the worst case scena­rio will go from being play­ers to being pawns. Secondly, I then recom­mend to act accor­din­gly! Too often, such topics are other­wise just put on the back burner.

There are many factors for the success of compa­nies. Apart from the top manage­ment, two of them are of para­mount importance in my opinion: stra­tegy and capi­tal. Without stra­tegy, capi­tal is not crea­ted or will quickly evapo­rate, and without capi­tal, stra­te­gies are diffi­cult to imple­ment. Both condi­tion each other and seek each other. It is well known that M&A must be an elemen­tary compo­nent of every corpo­rate strategy.

If a company does not have its own origi­nal poten­tial for growth, a merger or acqui­si­tion is, in my opinion, without alter­na­tive — apart from a sale. Because, only then can new product and market poten­ti­als be gained or know-how be expan­ded. Some also solve their own company succes­sion through M&A. VIRETUM CONSULT advi­ses on the deve­lo­p­ment and formu­la­tion of stra­te­gies and on the procu­re­ment of suita­ble equity and debt capi­tal. Even before foun­ding VIRETUM CONSULT, I have conduc­ted dozens of M&A tran­sac­tions myself as foun­der, buyer or seller. Ther­e­fore, I know the concerns of all parties invol­ved from my own expe­ri­ence. My heart beats for tradi­tio­nal compa­nies as well as for start-ups with inno­va­tive products and busi­ness models. “The variety in deal­ing with both at all stages of their deve­lo­p­ment makes the consul­ting work parti­cu­larly exci­ting for me, and my clients also bene­fit from it.”

About Hanns-Peter Wiese

Hanns-Peter Wiese, Dipl.-Kfm., has more than 25 years of busi­ness, corpo­rate finance and M&A expe­ri­ence. Prior to foun­ding VIRETUM CONSULT, he was a direc­tor of a major German bank in the field of corpo­rate finance, head of M&A at a corpo­rate finance firm as well as mana­ging direc­tor, gene­ral part­ner and mana­ger of seve­ral private equity and venture capi­tal compa­nies. He has comple­ted over 100 tran­sac­tions with more than 50 compa­nies in various indus­tries in Germany, Western Europe and the USA. He accom­pa­nied a large number of these compa­nies in their busi­ness cycles over many years as a spar­ring part­ner to the manage­ment or as a member of the super­vi­sory or advi­sory board and actively supported them in nume­rous finan­cings, M&A tran­sac­tions and IPOs.