As loyal readers of this online publication are aware, from time to time we like to highlight acquisitions in the news that catch our eye. These are deals that usually provide some insight into the ultimate motivation of professional buyers. Knowing why a particular buyer is interested in your company can be critical to the successful sale of your business. If you know why a buyer is willing to pay a premium for your business, you will be able to better negotiate the deal to your benefit.
The announced acquisition of Oneida Ltd (Oneida) by Monomoy Capital Partners (Monomoy) provides a classic example of this concept in action. As many of you are aware, “Oneida is the world's most recognized tabletop brand and the leading supplier of flatware and dinnerware to the foodservice market.” Monomoy is a New York-based private equity group that focuses on making strategic acquisitions in middle-market sized businesses.
You might be wondering the same thing I was once I saw this announcement: Why would an equity firm invest in an industry that appears to be so dependent on economic cycles? I mean if folks aren’t dining out at establishments that use flatware and dinnerware, then I would imagine that purchases of replacement food service equipment would be slow. As the press release points out:
“Oneida serves two broad market segments – foodservice and consumer. As North America’s #1 foodservice supplier of flatware and dinnerware, Oneida boasts a robust product and brand portfolio with many of the world’s strongest players in the hospitality, travel, restaurant and foodservice industries. In the consumer market, Oneida is the #1 tabletop brand in North America and has become one of the most globally recognized houseware brands with a large installed customer base.”
So a couple of things become clearer. As I highlighted above, Oneida just isn’t any other flatware/dinnerware/tabletop brand in the industry. They are in the number one position both in the foodservice industry AND the consumer market. We have discussed the importance of intangible assets before. One of the most important intangible assets (also known as “off-balance sheet assets”) is brand-name recognition. Although no details regarding the transaction were announced, it is safe to assume that the investment bank working for Oneida was well aware of how important the acquisition of the number one brand in both markets was to Monomoy.
But still the question remains, why Oneida? Of course acquiring any brand with the number one position in two key markets is a wise financial move. However, if you dig a bit deeper, you discover that Monomoy has a current portfolio company named Anchor Hocking (Anchor). For those of you unaware of Anchor, here is a brief description of its business from its website:
“Anchor is a leading North American designer, manufacturer and distributor of tabletop glassware products, providing the market place a complete tabletop solution. Anchor’s product line includes glass beverageware, bakeware, storage containers and barware; glass candle containers; high-end spirit bottles and specialty glass items. Anchor also sells glassware to both the consumer and the foodservice markets.”
So now the synergies – the motivations – behind the deal become clear. By combining Anchor, Monomoy’s current platform company, with Oneida, the new company will have the dominant position in many segments of the market.
Based on this, I would assume that Monomoy was willing to pay a premium for Oneida. As with all deals, if you can understand why a buyer is motivated to make an acquisition, you can negotiate a far better deal. Of course in a win-win scenario like this, not only are there synergies in play, Monomoy’s business model is designed to bring “customized business improvement programs in all portfolio companies that reduce operating expenses, increase profitability and encourage profitable growth.”
In many middle-market transactions like this, it is the financial, marketing and managerial expertise that the equity firm can bring to the table that really aids in the ongoing growth of both entities. Again, a real win-win for all groups involved.
We bring this deal story to you since it is just one example of the types of professional buyers that are active in the market. Generational Equity has relationships with literally thousands of buyers – buyers that have told us exactly what they are looking for in acquisition targets. If you would like to learn more about our processes, please contact us.
Chances are very good that there are buyers active in your niche right now as well. We would be glad to meet with you and explore your specific options. Given the tremendous economic and political uncertainty facing the country right now, you owe it to yourself and your family to ensure that every option is open to you. Since most of your net worth is tied up in your company, proactively planning for your future is a wise move.
© 2011 Generational Equity, LLC All Rights Reserved
We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
Bruce and I wanted to take this opportunity to thank Generational Equity for assigning Musa Jagne to our transaction. In Bruce’s words, “Musa did one hell of a job for us!”Karen S. Williams, CFO, BW Manufacturing
We are extremely pleased with the way Generational Equity handled the sale of our company. Your associates, Tom and Chris, did an outstanding job of getting us (me) through the process.Michael J Polarek, President, Paragon Packaging
We thank you Eric and Generational Equity making our dream come true.Larry Moore, Owner, A Company Portable Restrooms
The process was much more involved than I expected and your help, experience and advice was a big factor in making the negotiations go as smoothly as possible.Terry D. Wickman, President, Keytroller
Thanks again Phil and feel free to have a future client call me if they would like a referral. You are a true professional!Andy Graham, Vice President, Modern Heating & Plumbing
Greetings Mike. Thank you for the captivating and compelling presentation you made at the Phoenix presentation last week. Over many years in business yours was the most informative and well-presented presentation, on any subject, that I have ever attended! Your energy and enthusiasm combined with your concise and captivating support of your positions with easily understood examples and data was compelling.Pete L.
Tom Staszak is one of the most professional people I have dealt with in my last forty years of business. You’ve got a great group of people and you have built a truly professional organization.Michael J Polarek, President, Paragon Packaging
We were happy to see the interest in our company and what we cherished has not just a valuable company but an important company to the communities we served in.Larry Moore, Owner, A Company Portable Restrooms
Generational Equity educated and informed us – so that we could be on the upside of a good decision (to sell).Bil MacLeslie, CEO, ipHouse
Generational Equity’s assistance was invaluable in compiling and marketing our business.Bil MacLeslie, CEO, ipHouse
I couldn’t have asked for a better team than Michael and Deborah. We couldn’t have done it without them.Robert Evans, President and CEO of Mealtracker Dietary Software
I quickly recognized that Don was working for Sharpe Mixers above all else, and held our interests above others.Jay Dinnison, Owner of Sharpe Mixers
Your wisdom and experience were invaluable to me during this once-in-a-lifetime transaction.Ralph Noblin, President of Noblin & Associates
I would like to thank you and your firm, Generational Equity, for being our valued advisors in our journey.Bil MacLeslie, CEO, ipHouse
Thank you again for all your guidance and support. Any company will achieve what they intend, if they have you on their team!Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
I wanted to write you a quick letter to express our appreciation and our delight on the outcome of helping us through the process of our recent sale. We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.Terry D. Wickman, President, Keytroller
We will highly recommend Generational Equity and Musa Jagne to any business owner about to embark on the same process.Karen S. Williams, CFO, BW Manufacturing
I must say that I have never worked with a more driven, competent and focused individual as Don Ho.Jay Dinnison, Owner of Sharpe Mixers
Michael worked tirelessly, He followed every lead meticulously and urgently to make sure nothing was missed.Robert Evans, President and CEO of Mealtracker Dietary Software
The help you provided us during each step of this process made us feel very comfortable and confident we were selecting the right approach to transition our Company.Andy Graham, Vice President, Modern Heating & Plumbing
We knew it would be a difficult task to have someone really understand our business and our market, prior to researching a possible buyer, so it was imperative that we found someone of your caliber, with definite proven experience in this area.Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
The information we learn from customers helps us personalize and continually improve your experience. Here are the types of information we gather.
We receive and store any information you enter on our Web site or give us in any other way. We do not sell or rent your personal information to others without your consent. We use the information we collect only for the purposes sending promotional information, enhancing the operation of our site, serving advertisements, for statistical purposes and to administer our systems. We DO NOT use third parties to provide customer service, to serve site content, to serve the advertisements you see on our site, to conduct surveys, to help administer promotional emails, or to administer drawings or contests, but reserve the right to do so in the future without advance notice.
By submitting my name electronically and clicking the “submit” button, I understand that I am providing Generational Group, Inc., Generational Equity, LLC, Generational Capital Markets, LLC, DealForce LLC, their affiliates, representatives, contractors, etc. (“Generational Group”) my telephone number, which may include a number that is wireless and/or a number that is on a national, state, or other Do Not Call registry or list. I hereby consent and agree to receive telephone calls including any autodialed and/or pre-recorded telemarketing calls and/or text messages (telemarketing) from or on behalf of Generational Group at the telephone number provided. I further consent and agree that telephone calls may be made using automated technology such as an automatic telephone dialing system, artificial or prerecorded voice, or SMS text messaging. Consent is not a condition of purchase. I further warrant and represent that any telephone number provided is not on any state or national Do Not Call Registry and that by agreeing to these terms and conditions that if any number provided is on any such registry, I hereby consent and agree to receive telemarking calls and/or communications including any phone calls, text messages, URLs, links, emails, etc. to the telephone number(s) and/or any e-mail addresses provided. I understand that by entering my name in the electronic form provided, that I am signing my name as equally as if it was my handwritten signature and that it is my intent to provide an “electronic signature” as that term is defined in state and federal law, as well as industry practices for e-commerce.
For reasons such as improving personalization of our service, we might receive information about you from other sources and add it to our account information.
Generational Group may license the use of its intellectual property including but not limited to its name, likeness, and logo for the use of affiliated offices. Such affiliated offices may not be owned, controlled, managed, supervised or staffed by employees, officers, or agents of Generational Group. Affiliated offices may be independently owned and operated. For more information about a particular office, please contact Generational Group at its office in Dallas, Texas.
This page may contain other proprietary notices and copyright information, the terms of which must be observed and followed.
Information on this web site may contain technical inaccuracies or typographical errors. Information may be changed or updated without notice. Generational Group may also make improvements and/or changes in the products and/or the programs described in this information at any time without notice.
Generational Group does not want to receive confidential or proprietary information from you through our web site. Please note that any information or material sent to Generational Group will be deemed NOT to be confidential. By sending Generational Group any information or material, you grant Generational Group an unrestricted, irrevocable license to use, reproduce, display, perform, modify, transmit and distribute those materials or information, and you also agree that Generational Group is free to use any ideas, concepts, know-how or techniques that you send us for any purpose.
Our computer system protects personal information using advanced firewall technology.
Information Generational Group publishes on the World Wide Web may contain references or cross references to other products, programs and services that are not announced or available in your country. Such references do not imply that Generational Group intends to announce such products, programs or services in your country. Consult a Generational Group representative for information regarding the products, programs and services which may be available to you.
Generational Group makes no representations whatsoever about any other web site which you may access through this one. When you access a non-Generational Group web site, please understand that it is independent from Generational Group, and that Generational Group has no control over the content on that web site. In addition, a link to a non-Generational Group web site does not mean that Generational Group endorses or accepts any responsibility for the content, or the use, of such web site. It is up to you to take precautions to ensure that whatever you select for your use is free of such items as viruses, worms, Trojan horses and other items of a destructive nature.
IN NO EVENT WILL Generational Group BE LIABLE TO ANY PARTY OR ANY DIRECT, INDIRECT, SPECIAL OR OTHER CONSEQUENTIAL DAMAGES FOR ANY USE OF THIS WEBSITE, OR ON ANY OTHER HYPERLINKED WEBSITE, INCLUDING, WITHOUT LIMITATION, ANY LOST PROFITS, BUSINESS INTERRUPTION, LOSS OF PROGRAMS OR OTHER DATA ON YOUR INFORMATION HANDLING SYSTEM OR OTHERWISE, EVEN IF WE ARE EXPRESSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Furthermore, all information contained within this website is the property of Generational Group.
Honored to win Investment Banking Firm of the Year 2 years running.
Over 50 awards and counting.
Sign up to receive regular email updates, industry-leading insights and details on complimentary M&A executive conferences in your area from our award-winning team
Success, you have been added to our list.