Mike Nall, CPA, CM&AA, CGMAFounderAlliance of Merger & Acquisition Advisors

The AM&AA•Founded in 1998 by partners for 10 regional CPA firms to provide a range of transactional advisory services essential for successful M&A transactions.

•Primary goals: –Help members improve their level of knowledge, –Provide a network of trustworthy professionals with whom they can share information and resources. –Provide access to the tools to help them better market, manage and implement successful engagements

Profile of AM&AA Members Invest. Banker/M&A Intermediary Consultant   Accountant  Corporate Development   Equity Investor    Business Valuator    Attorney  Asset Manager/Financial Advisors   LenderTechnology SpecialistOther

 *54% of membership has CM&AA

29%16%15%9%9%8%7%4%1%1%1%

The Body of Knowledge Documented

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A Global Solution:

INTERNATIONAL EFFORTS

•1000+ Members in 25 different countries

•Established Chapter in Europe, focused efforts to begin new Chapters in Asia and Brazil

•Cross Border Task Force committed to developing an International M&A Best Practices White Paper

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Where Are Our Members?

•Australia•Austria•Brazil•Bulgaria•Canada•China•Germany•Hong Kong

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•India•Israel•Italy•Lebanon•Malaysia•Mexico•Philippines•Puerto Rico•Qatar

•Republic of Korea•Saudi Arabia•Singapore•Spain•Switzerland•The Netherlands•United Kingdom •The United States

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Capital Markets Overview

Revenues($millions)

5 150 500 1,000

Small Companies Middle Market Large

Companies

5.4MM 300,000 2,000P O P U L A T I O N

15% 40% 45%G D P

2-3x 4-11x 12x +V A L U A T I O N

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Example Exit Channel 

Strategic Buyers Financial Buyers Related Buyers

PureProduct / IP Sale

Sale / Merger

to Strategic

HybridPEG

“Add-On”

PEGPlatform Buy-out

PEG“Staged”Re-Cap

PEG Financed

MBO

Leveraged

MBO(ESOP?)

Long-Term

“Staged”MBO

JV to “Staged” Strategic

Sale

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•Owner Motives Matter – PrivateCo’s Values

Business Owners Choose a Transfer Value!

Method Value World Value

Buy/Sell Asset Market Value $  2.4 MMMBO Investment Value     7.5 MMESOP Fair Market Value     9.2 MMEquity Recap Financial Market Value   12.0 MMNegotiated Owner Value   15.8 MMAuction Synergy Market Value  16.6 MMPublic Public Value   18.2 MM

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•It’s a Recast World–Which earnings level do you use to value?

•Reported EBITDA $1MM•Recast EBITDA $2MM•Synergized recast EBITDA $3MM

Using a ‘5’ multiple, the same company has a $5MM, $10MM, and $15MM market value – depending on which earnings level is used

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•Market Value - Conclusion–Most private owners want to increase the value of their company–Risk – acquisition multiple is specific to a buyer and reflects their risk assessment (hurdle rate)–Return – EBITDA available post-transaction–Big opportunity for us to help owners plan and execute

Alliance of Merger & Acquisition Advisors222 N. LaSalle, 3rd floorChicago, IL 60601www.amaaonline.com

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