2 deals, 76 IOIs, 1 best fit buyer

“None of us is as smart as all of us.” This quote from Ken Blanchard sums up the benefit of Cornerstone International Alliance. That value played out recently when two members, each representing the same kind of business, collaborated to find their clients the best buyer.

Advisors: Scott Bushkie, Cornerstone Business Services
Bob McCormack, Murphy McCormack Capital Advisors

Industry: Recycled synthetic lumber

Deal locations: Wisconsin and Pennsylvania
Shared resources
: Industry insight, margins, and trends; buyer list; buyer vetting

Outcomes: 76 combined IOIs, one shared buyer, both deals significantly over benchmark

“We picked up this recycled plastics deal. It’s a unique niche, and we hadn’t done a deal in this space before,” said Scott Bushkie, president of Cornerstone Business Services. “I shared it with the CIA group and Bob said, ‘We’re working on one of those as well.’”

Buyer lists. While Bushkie’s deal was further along in the process, the two advisors were able to share insight, including marketing ideas, margins, and industry trends. One of the clear initial wins came from sharing buyer lists.

“We can all do 100s of hours of research, but there are so many buyers out there it’s hard to find them all. We each had buyer targets the other hadn’t found,” said Bushkie.

Sarah Moores and Robert Dukelow-Smith from Forward Corporate Finance in the UK contributed to the buyer list as well, helping extend reach to a strong international pool. And while none of the international buyers was right for this project, McCormack said those new relationships are showing promise as other opportunities come up.

Buyer vetting. McCormack’s deal was late in the IOI stage as Bushkie’s was closing. But Bushkie knew his buyer team was aggressive and thought they might be a good fit – if they moved fast. He helped make the connection.

“Ultimately that was the buyer who rose to the top,” said McCormack. “They offered deal terms, including equity and a leadership position that was attractive to our client.”

While the introduction itself was critical, McCormack points to the extra value that comes from knowing you have a genuine, committed buyer at the table.

“Before the client signs that LOI, you want confidence the deal will actually get to close,” McCormack said. “From a vetting perspective, it was helpful hearing from Scott. He told us he’d do another deal with this group in a heartbeat.”

Results. Together, the two deals earned a combined 76 indications of interest.  And both earned market valuations significantly above benchmark.

McCormack recently followed up with his client, who is leading the new enterprise. “They’ve increased EBITDA 40% in about 18 months and they’re getting ready to do more deals. It’s been a successful growth story for everyone at the table.”