Private equity groups are in the acquisition business. They earn their profit by buying and growing privately-held companies of various sizes. Some purchase independent portfolio companies, but many use the platform/add-on model. That is, they will acquire a large company in a particular industry and then grow it through acquisitions of smaller companies in the same or related industry. By buying appropriate related companies they can:
- gain market share
- gain economies of scale, such as
- quantity discounts
- consolidated management
- other efficiencies
- gain competitive strength through cost advantage and plain old elimination of one or a few competitors
class="content"
Orion Capital Group specializes in putting together deals between private equity groups and privately held businesses in the 2 to 50 million dollar range. We know which groups are looking for which types of independent portfolio companies or add-ons. We also know how to effectively package our clients’ companies to show each PEG prospect how that business will fit in with their investment criteria or platform company.
When we call with a deal, PEGs know it is a deal worth looking at. Few smaller PEGs have the resources to do deal sourcing in-house. In a very real sense, we do their finding and screening for them. Many larger PEGs concentrate their internal searches on finding new platform companies, leaving add-on searches to us.
We constantly monitor PEG acquisition activity so we are always current on their needs. We talk to our contacts at the PEGs regularly and visit with them at conventions, conferences, and seminars.
If you are considering the sale of your company now or in the near future, give us a call. We'll be happy to discuss this possibility with you without cost or obligation.