Merger & Acquisition
Completing an M&A process can be a lengthy and challenging process. Whether you are seeking a company to merge with or acquiring a business that aligns with your strategic goals, the process can often be complex and difficult to manage.
At Energy Market Partners, we provide a comprehensive suite of advisory and support services to companies navigating the complex process of merging with or acquiring other trading companies. From target identification to post-merger integration, we will ensure a seamless transition for both parties involved.
We have been involved in completing M&A across borders, which with the help of our services, have been successful for both parties and secured efficient post-merger integration.
You can keep focus on your current business objectives, while benefiting from a smoother, more efficient process, operational security, and a stronger foundation for future growth.
Who is the Merger & Acquisition service for?
If you can say yes to one of the following things please reach out:
Are you a hedge fund looking to expand your footprint within the energy sector, and want to avoid setting everything up from scratch?
Are you an established trading company looking to add an asset management portfolio and operational capabilities to manage this?
Are you an asset management company looking to add an operating trading business to enable optimization of your asset and avoid outsourcing this to third parties?
Then the Merger and Acquisition services are designed for you. Once you have reached out to us, you will be guided through our M&A process and, if there is a potential match, have successfully completed a strategic M&A, which aligns with your strategic goals.
Our deep industry knowledge, extensive network, and proven track record can help you unlock new opportunities, revenue streams, and a stronger foundation for future growth.
The process of Merger & Acquisition
EMPs involvement in the M&A process involves a series of structured steps, which guides you through the process of combining two businesses (merger) or acquiring an already existing company (acquisition).
Overall Time Estimate:
The entire process from initial inquiry to finalization usually takes between 5 to 10 months.
Initial inquiry and Consultation
Reach out to Energy Market Partners (EMP) if you are seeking to add another revenue stream within the energy sector to your current business.
This step typically requires 1 - 2 meetings over the course of a week, during which EMP conducts an initial consultation to understand your needs and objectives.
KYC (Know your Customer) Check
Once you’ve expressed interest, we conduct a thorough KYC check, to ensure compliance and establish trust.
This process usually takes 1 - 2 weeks.
Preparation and Planning
Together we define your objectives for the M&A deal, including identifying strategic goals such as market expansion, diversifying your revenue streams, adding discretionary and/or algorithmic trading to your current business model. We evaluate your financial capacity to complete a M&A, which helps set the parameters for the size and type of deal to pursue
This process normally takes 2 -4 weeks.
Target identification
Utilizing our network and existing Trading Partner Catalog we identify companies that align with your objectives for the M&A, strategic goals and vision for future growth.
As we already have companies in our Trading Partner Catalog, we will be focusing on utilizing our network to search for other interested companies. We are reliant on their responsiveness, why this process can take up to 4 weeks.
Matching
Based on the Target Identification and our work in the KYC and Preparation and Planning steps, we approach the targeting companies and clarify interest on their end.
This process normally takes 1 - 2 weeks.
Initial Introduction
Together with you, we reach out to the companies with matching interests to explore a potential fit further. At this stage, initial discussions take place and a Non-disclosure agreement (NDA) is signed to ensure confidentiality between you and the matching company.
If multiple matching companies, a series of introduction meetings
Due Dilligence
If both parties agree to pursue a potential partnership further, an in-depth Due Diligence is initiated, covering financial, legal, operational review and strategic fit and many more details to ensure that all aspects are covered and a fair valuation of both companies (in case of merger) or the targeted company (in case of acquisition) can be made prior to the negotiation.
As this step covers all aspects of the companies, this is the lengthiest process and can take up to 3 months.
Valuation and Negotiation
EMP will assist in negotiations, Introevaluate the deal, terms of the deal (cash, stock or merger) and help structure ownership arrangements, including future roles of executives.
Depending on the complexity of negotiations and the readiness of both parties, this step typically spans 1 - 2 months.
Closing the Deal
Once all terms are agreed upon, EMP helps finalize the M&A and, if requested, continues to support the combined entity through our offered services.
As all terms have been agreed upon during the Valuation and Negotiation step, closing the deal normally takes 1 - 2 weeks.
Post-M&A Integration
EMP continues to support the entity that remains operational and legally existing, making sure that all relevant authorities, exchanges and local power and gas market authorities are notified and updating all necessary paperwork. This also includes our other services, such as Market Entry, market continuity. See our Service Page for more information.
Making sure that all changes are registered correctly with the relevant external counterparties usually takes - 6 weeks.
Why use Energy Market Partners?
Ensuring full anonymity: We understand that it can be important for both parties to not share their identity before they know if it is the right fit. We therefore keep the process fully anonymous, only sharing the information which is needed to get an impression of both parties. Only if both parties agree, the identity of the parties will be shared.
Transparent fee structure: Our fees are fixed, giving you the opportunity to budget our services into the overall cost of the M&A.
If we are successful in finding the right partner for you, an exclusivity agreement using our Market Access and Market Continuity services for your company will be required.
Energy Market Partners’ role: We will assist you throughout the entire process of the M&A and continue to support you after completion through Post-Merger integration and continued support enabling your future growth.
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Why Use EMP Instead of DIY
Expertise and Efficiency
EMP’s extensive experience in the energy market ensures that you are connected with the right partners quickly and efficiently. You gain access to our industry knowledge, strategic insight, and experience, which ensures that every step—from Preparation and Planning to post-merger integration—is handled with precision, increasing the likelihood of a successful outcome. DIY efforts often lack the structured approach and industry connections that EMP offers, leading to longer timelines and increased chances of failure.
Anonymity and Security
EMP ensures full anonymity until both parties agree to proceed, protecting sensitive information. Without this, DIY efforts can expose you to unnecessary risks, including potential breaches of confidentiality.
Thorough Vetting
EMP conducts thorough KYC checks to ensure that all partners are legitimate and trustworthy, minimizing the risk of fraud or unreliable partners. DIY approaches often overlook this crucial step, leading to potential legal and financial complications.
Post-Merger Integration
EMP will assist you in this critical phase, when the benefits of the completed M&A must be secured and the foundation for future growth is made. DYI approaches often means that the company gets caught in operational matters, which reduces the benefit of the M&A through slower realization of synergies.
Common Pitfalls Avoided by EMP
By partnering with EMP, you avoid these pitfalls, ensuring a smoother, more effective Merger & Acquisition process that sets you up for long-term success.
Misaligned Partnerships
DIY efforts often lead to partnerships that are not well-aligned, resulting in conflicts and failed ventures. EMP’s matching process is designed to ensure compatibility and mutual goals.
Inadequate Due Diligence
Incomplete or insufficient due diligence can lead to significant issues later. If hidden liabilities, legal disputes, financial instability, or operational weaknesses are not identified in the target company, these problems can emerge post-acquisition and severely impact profitability and integration efforts.
Reduced benefits and Prolonged Timelines
Without the structured process that EMP offers, M&A can take significantly longer, and can distract management and internal resources from running the core business efficiently.Companies often get caught in their current operations, which reduces the benefit of the M&A through slower realization of synergies.EMP streamlines the process, increasing the likelihood of a successful outcome in a reasonable timeframe.
Frequently Asked Questions
- Expanding market presence
- Diversifying revenue streams
- Gain access to intellectual property or new technologies
- Enhancing competitive advantage
The timeline varies depending on the size and complexity of the deal but typically ranges from 5 to 10 months. The due diligence process and negotiation can significantly affect the timeline.
- Cash transaction: The acquirer pays the purchase price in cash.
- Stock transaction: The acquirer offers its own stock to the target company’s shareholders in exchange for shares.
- Debt financing: The acquirer borrows money, often through loans or bonds, to fund the purchase.
- Combination: A mix of cash, stock, and debt can be used.
- Overvaluation of the target company
- Failure to realize expected synergies
- Legal or regulatory challenges
- Loss of key-employees post-merger
- Operational challenges during integration
- Conduct thorough Due Diligence
- Align strategic goals between the two companies
- Ensure effective integration of employees
- Thoroughly plan and execute post-merger integration proces
- Set and monitor KPIs for the M&A and conduct Post-Deal/Post-Implementation evaluation
Still have questions?
Start your energy trading adventure today
With EMP’s full-service approach, we make energy trading simpler and more efficient, turning market complexities into opportunities for your business to grow and succeed.