Founded in 1919, Fenner & Beane, LP. is private investment firm with offices in London, Toronto, Hong Kong, and Los Angeles. We are actively engaged in a continuous investment program of acquiring companies with strong balance sheets, experienced management teams and demonstrated operating results. In certain cases, we consider companies in turn-around situations or involved companies in Chapter 11 proceedings, if actions can be taken to correct or improve the situation.
Fenner & Beane, LP. wishes to maintain an active dialogue with other investment pools, investment bankers, financial institutions, venture capitalists, insurance companies, pension fund managers, finders, business brokers, accountants, attorneys, and other members of the financial community.
OUR INVESTMENT PROCESS
1. SELECTION PHASE
The first step in the investment process is to carefully screen identified prospects to determine their suitability under certain criteria. The criterion listed below has been developed by Fenner & Beane, LP. to assist in screening prospective acquisition candidates.
ESTABLISHED BUSINESS ENTERPRISES
Primary manufacturers, distributors and retailer of industrial, commercial and consumer products with significant existing or potential market shares in concentrated industries, or companies with substantial leadership positions in fragmented markets. Relatively mature companies in viable industries are preferred, which offer the potential to generate exceptional investment returns while also limiting the risk to the investment group.
PROVEN OPERATING PERFORMANCE
A record of profitable operations for at least three to five years. Constant earning and consistent cash flow is more important than rapid growth, although companies capable of at least doubling earnings every five years are preferred. Size is not a factor. In regard to underachieving companies, it is recognized that adverse circumstances sometimes provide historical results not indicative of the true potential of a business. The focus, therefore, is not necessarily today’s circumstances but what a company can become if it is properly capitalized and managed.
STRONG BALANCE SHEET
Tangible, viable assets, a high degree liquidity and little or no debt. Companies with fast-turning inventories and accounts receivables, undervalued excess or hidden assets, and relatively low capital intensity are preferred.
2. ACQUISITION PHASE
Quality Management Teams. Mature, experienced and competent managers with dedication, integrity, and proven records of success are preferred. Management must be willing to remain or be easily replaced from the outside. In either case, management should have an equity involvement in venture.
After an acquisition candidate meets our criteria, an extensive in-depth analysis is conducted of the company, its industry, products, competition, markets, management, sales and earnings, balance sheets and cash flow. From this analysis, the company is valued, an offering price is determined and the financing and legal structure for the proposed investment is determined. We then conduct negotiations with the seller and its legal and accounting counsel. A letter of intent is prepared followed by a definite sales agreement to be signed at closing.
The financing of each investment is conducted simultaneously with the acquisition phase. Once the buyer and seller agree on price and terms, our Company has the responsibility for arranging the necessary debt and equity financing. We maintain excellent working relationships with numerous major lenders and equity sources. These financial institutions include family offices, commercial banks, commercial finance companies, insurance companies, hedge funds, pension funds, SBIC’s and funding pools. Some may participate in the acquisition with senior and subordinate debt and may also become equity partners.
3. MONITORING PHASE
The completion of an acquisition triggers the beginning of an extremely intensive follow-up to ensure the success of the investment. Our Company devotes a substantial amount of time to each investment in an effort to achieve a high probability of success.
Our relationship with management is primarily supportive and we do not become directly involved in the day-to day operations. The company makes its contribution through participation on the Board of Directors. Although participating in management at the board level, we strongly believe in operating autonomy for the management group
OUR STAFF EXPERTISE & MANAGEMENT SUPPORT + COMPANY’S GENERAL COUNSEL & INDEPENDENT AUDITORS
- Corporate Goals & Objectives
- Strategic Planning
- Corporate Business Plans
- Financial Planning
- Budgets & Controls
- Cash Management Credit
- Data Processing
- Debt & Equity Financing
- Mergers & Acquisitions
- Insurance Programs
- Profit Sharing
- Other Benefit & Incentive Plans