ACG Boston welcomes the following new members who joined the Boston Chapter recently:

Anne Baldwin, DiCicco, Gulman & Co.
Allyssa Bates, Babson College
John Binda, Touch Ahead Software
Joshua Burnie, Merrill Lynch
Jonathan Butler, DiCicco, Gulman & Co.
Michael Carota
Stephen Casey, Sonicbids
Christopher Casgar, Ahold
Brian Chilton, AllianceBernstein
Dwight Davidsen, Avidorn, Inc.
Joe Epstein, KPMG
Matthew Haggerty, ProGen, Inc.
Virginia Halloran, KPMG
Mark Hovermann, Sensata Technologies
Gregory Kaden, Goulston & Storrs
Larry Kaplan, CBIZ Tofias
Paul Kelly, Sovereign Business Capital
Sharon Kennedy, Kevin Kennedy Associates Inc.
Lawrence Klaff, GB Merchant Partners
James Kimberly, Sapphire Consulting
Michael Krongel, Reads, Inc.
Paul Languirand, CBIZ Tofias
Donna Marr, DiCicco, Gulman & Co.
Michael McAuliffe, Citizens Bank
Linda Moulton, Ceralta Technologies, Inc
Lawrence Radowski, Integrated Project Mgmt. Co.
Todd Rainville, Ampersand Ventures
Mark Renzi, FTI Consulting
William Rodgers, Tarlow Breed Hart & Rogers, P.C.
Joel Rothenberg, DiCicco, Gulman & Co.
Michael Savage, NachmanHaysBrownstein
Barbara Schoenfeld, Saffron LLC
Thomas Souls, TES & Associates
David Sullivan, DiCicco, Gulman & Co.
David Swan, CBIZ Tofias
Ross Whittaker, Merrill DataSite
Jarrad Zalkin, TM Capital

Thank you for your continued support of ACG Boston!

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How much longer until securing capital gets less daunting than it has been over the past year and a half? That is a question on every dealmaker and business owner’s mind and the one I posed to Oscar Jazdowski of Silicon Valley Bank who serves on the ACG Corporate Development Forum program committee.

Silicon Valley Bank, consistently lending over the past 18 months, focuses on technology, life sciences and venture capital companies with capital requests ranging from sub $1 million to multi-millions depending on the size, stage and industry of the client. In Oscar’s opinion, things will change for the better over the next year once Wall Street analysts change their focus from “what are your bank’s woes and have you fixed them yet?” to “how will your bank grow?” When that shift in thinking occurs then lending practices at more banks will become more favorable. Naturally, at first and at most banks the lending practices will be more conservative with EBITDA multiples in the 2-2.5x range. In order to secure what would have been considered a normalized rate of 3-4.5x of EBITDA for a profitable industrial company, applicants will have to demonstrate their achievement of strategic goals including revenue and profitability targets.

What’s going on with small businesses?
•    Last February the American Recovery and Reinvestment Act included some favorable loan options for small businesses. Unfortunately, the SBA guarantees to 90% of principal, waiver of loan fees and float loans up to $35k in expenses interest free for 6 months reportedly have not panned out so well per CFO Magazine.
•    Angel Investors, often an initial source of equity, disbursed 27% fewer dollars in the first half of 2009 compared to the same period 2008. Though the number of deals increased by 6%. Center for Venture Research at UNH: http://wsbe.unh.edu/analysis-reports-0
•    Venture Capitalists invested $17.7 billion in 2,795 deals in 2009 which is the lowest dollar level since 1997 and a 37% decrease in dollars and 30% decrease in deal volume from 2008. Though the 4th quarter of 2009 dollar investments declined by 2%, deal volume increased by 15% from Q3 2009 as did the number of first time financings. MoneyTree Report by PricewaterhouseCoopers and the National Venture Capital Association https://www.pwcmoneytree.com/MTPublic/ns/index.jsp

Don’t despair, according to Oscar. By generating predictable and repeatable revenue and cash flow now, securing capital in the future will get easier. Think of the cable companies where customers renew their service subscriptions month after month. The extent to which a business has that kind revenue stickiness will work in your favor when applying for a loan. Don’t have a subscription business? Then focus on your organization’s ability to accurately forecast sales and fill the pipeline for sustaining and growing revenue and profit performance.

Carol Bergeron

BERGERON ASSOCIATES

Workforce Planning & Integration | Management Development | Human Resources

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by guest blogger Josef Volman, Esq., Burns & Levinson LLP and member of ACG Boston’s DealMakers Breakfast Committee

As he got up on stage with the Championship Trophy number 17 displayed next to him, you couldn’t help but see his enthusiasm and passion for what he has accomplished.  Wyc was very forthcoming in sharing his opinions and giving the audience the inside story on how he was able to convince his investor group to buy the Celtics and back several key transactions since his group purchased the Celtics.

Wyc’s background was in venture capital with Highland. He pointed out that beginning with his career as a lawyer doing due diligence in the frothy IPO market a few decades ago, and then in his work as a successful venture investor in the healthcare industry, Wyc’s main goal was to minimize risk.  Which is what made buying the Celtics, a deal he said that was extremely risky, such a challenge for him.

His inside account of his meetings with Steve Pagliuca and other investors who were willing to step up and take the risk with him was riveting.  He then shared an interesting fact — 24 of the last 25 NBA Championship teams had a common recipe for success: 3 NBA All-Stars, including, one which was an all time top 50 NBA player.  He disclosed how he and Danny Ainge applied that formula to put together the big three and go after championship number 17, including the trades for Ray Allen and Kevin Garnett.

I am very proud that my partner Frank Segall and I invited Wyc to speak to our group. His great combination of modesty, confidence and humor made for one of the most entertaining presentations we have seen at ACG.  We are lucky to have such a philanthropic owner in our community who raises the bar for what we can expect on, and off, the court from our beloved sports heroes.

Burns & Levinson sponsored ACG Boston’s DealMakers Breakfast on January 21, 2010, which featured Wyc Grousbeck of the Boston Celtics

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Benning Associates LLC, a Boston-based investment bank, has announced that Peter Cahill, a senior banker with 15 years of deal-making experience, has joined the firm.

“New England is a key market for Benning Associates – our senior bankers have all worked since the mid-1990s at respected Boston firms including Adams Harkness and Tucker Anthony,” said Greg Benning, Benning Associates’ managing director and co-founder. “We have known Pete for 10 years. He has strong M&A deal-making skills and industry expertise in resource technologies and business services. It will be great to work with him again.”

Cahill began his career at the emerging growth investment bank Adams Harkness, where he helped launch and lead that firm’s Resource Optimization Technologies Group and San Francisco office. Most recently he led the Energy Technology Group at First Albany Capital. His experience includes successful investment banking client transactions across technology, business services and emerging growth industry sectors.

Commented Cahill, “I’m excited to be joining a platform that has been specifically tailored to serve middle market clients. Much of my banking career has been working with clean energy and advanced energy technology companies and I look forward to continuing that focus at Benning Associates.”

Jay Remington, Managing Director and Co-Founder of Benning Associates, commented, “We are very excited that Pete is re-uniting with us. We have worked together on very successful projects, and Pete’s skills strengthen our senior banking team. Our strategy is to be a different kind of investment bank: Significant middle market transaction experience without the organizational issues or costs of a large financial institution. Pete is a great fit with our culture and goal of being a leading next-generation M&A boutique.”

Founded in Boston in 2009, Benning Associates LLC is an investment banking boutique focused on providing differentiated M&A and corporate finance advisory services to middle market company owners and investors. The BA team brings a different kind of track record and service offering to its middle market clients, combining extensive M&A and financing experience with cost-efficient, technology-leveraged client service. Benning Associates’ value proposition is this combination of middle market experience and cutting-edge efficiency. The firm’s goal is to establish itself as a leading next-generation boutique investment bank.

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In the midst of uncertainty Harris Williams & Co. cultivates opportunity.

In 2009, Harris Williams & Co. joined the world in facing one of the most challenging financial environments of our generation. As global markets recover, we continue to nourish and nurture our strengths, and stand ready to lead the middle market with the same vision and fortitude we have always applied to take our clients to the top.
In 2009, Harris Williams & Co.:

•    Expanded internationally with the opening of Harris Williams Ltd. in London
•    Opened a new office in Cleveland
•    Expanded our industry groups
•    Established a restructuring advisory practice
•    Successfully sold over 70% of our deals to strategic buyers
•    Approximately half of our strategic deals involved international buyers from North America, Europe and Asia
•    Completed multiple minority equity recapitalization and growth equity transactions
•    Hired additional top-level professionals at our senior and junior levels
•    Finished the year with great momentum having closed 12 deals in December

Learn more about how we can cultivate opportunities for you at harriswilliams.com.

Harris Williams & Co. is the premier middle market advisor with a two decade legacy of sell side excellence serving clients worldwide. The firm is focused exclusively on the middle market providing sell side and acquisition advisory, restructuring advisory, board advisory, private placements and capital markets advisory services. For more information about Harris Williams & Co., please visit www.harriswilliams.com.

For general inquiries, please email hwcoinfo@harriswilliams.com.

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Friends,

Please find our most recent BB&T Capital Markets Commercial & Industrial Monthly Update, compiling sector activity for the month of December 2009.

We have a dedicated team of investment bankers serving the industrial sector. If we can be of assistance to you, please feel free to call us directly.

Click here to view our most recent report.

Best regards,
Matt Gilman
Co-Head – Commercial & Industrial Investment Banking
BB&T Capital Markets
804-782-8780
mgilman@bbandtcm.com

Ryan Mitchell
Co-Head – Commercial & Industrial Investment Banking
BB&T Capital Markets
804-787-8240
rjmitchell@bbandtcm.com

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At the outset of a new year and a new decade we’d like to thank current and past clients and referral sources for the trust they have placed in us for over 18 years. It is because of this trust that Tully & Holland is pleased to report another strong year and the successful completion of six M&A assignments during 2009.

With the value of worldwide M&A down 28% last year according to Thomson Reuters, and the slowest annual period for M&A since 2004, Tully & Holland’s 2009 performance is a clear illustration of our ability to consummate transactions regardless of economic conditions. The Firm’s deep industry knowledge and experience consummating consumer product M&A transactions enables us to provide satisfactory outcomes for our clients even during the most difficult of times.

As investment bankers focused upon the consumer products sector such as multichannel merchants, retailers, and consumer product manufacturers & distributors, we would be delighted to hear about situations where our M&A advisory and corporate finance specialists could be helpful. For further information visit our website at www.tullyandholland.com or contact Tim Tully at 781-239-2900 (ext. 14) or ttully@tullyandholland.com.

For complete details of each transaction click here.

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There are no crystal balls for predicting what lies ahead. However there are some economic indicators business executives keep an eye on. Take a look at the links below and please let me know two things:
•    Which ones you’d most likely access on a regular basis?
•    What indicators you regularly monitor that may be of interest to other ACGers?

1.    ACG-Thomson Reuters Year-End 2009 Dealmakers Survey Finds 77 Percent of Massachusetts Dealmakers Expect M&A Activity to Increase Over Next Six Months http://www.acgboston.org/UserFiles/file/boston/12_09_09%20Boston%20Release.pdf

2.    ACG-Thomson Reuters Year-End 2009 Dealmakers Survey Reveals Obstacles and Opportunities for M&A and Private Equity Investing http://chapters.acg.org/UserFiles/file/global/2009%20ACG%20Thomson%20Reuters%20Year-End%20DealMakers%20Survey%20FINAL.pdf

3.    Federal Fund Rate is the rate at which banks lend their money deposited at the Federal Reserve to each other. It will remain in a range of zero percent to 0.25 percent and is expected to remain low for some time. http://www.bankrate.com, http://www.newyorkfed.org/markets/omo/dmm/fedfundsdata.cfm

4.    Gross Domestic Product measures the overall health of the economy. GDP increased at an annual rate of 2.2% for Q3 2009 preceded by decreases in the previous 4 quarters. Bureau of Economic Analysis has tracked GDP since 1930:  http://www.bea.gov/national/index.htm. Look for “Percent change from preceding period”. Check out stats by industry and state. See how the US stacks up against other countries too.

5.    Unemployment, job loss and growth naturally flow from GDP.  The national unemployment rate doubled from 5% to 10%+ over the last two years and hasn’t been that high for a couple of decades. For monitoring national, regional and metropolitan unemployment figures tap the Bureau of Labor Statistics: http://www.bls.gov/eag/

6.    Producer Price Index is an indicator of price pressures faced by businesses and may be a lead indicator of price pressures consumers may soon face:  http://www.bls.gov/pPI/

7.    Consumer Price Index measures inflation encountered by consumers for products and services: http://www.bls.gov/CPI/

8.    Retail Sales – Department of Commerce measures consumer spending on retail and food services: http://www.census.gov/retail/

9.    Energy Costs – For historical data, forecasts and analysis on a wide range of energy sources & their costs go to the US Energy Information Administration, Independent Statistics & Analysis: http://www.eia.doe.gov/oiaf/forecasting.html , http://www.eia.doe.gov/emeu/steo/pub/contents.html

What economic indicators do you monitor?  Let me know and if there’s enough interest we’ll compile a list of quick links for easy access on a regular basis. And thanks in advance for your suggestions.

Carol, carol@bergeronassociates.com

BERGERON ASSOCIATES

Workforce Planning & Integration | Management Development | Human Resources

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C.W. Downer & Co., an international middle-market investment bank, is pleased to announce the promotion of Frank Merkel to Managing Director, effective January 1, 2010. In his new role, Mr. Merkel will play an important role in the development and implementation of our global business strategy, while continuing to advise existing clients, forge new client relationships, and execute cross-border transactions. Mr. Merkel joined C.W. Downer & Co. in 2003 and was instrumental in building the firm’s Frankfurt office.

“Frank’s advancement to Managing Director reflects how highly we value both his contributions to the firm and his dedication to delivering superior advisory services to our clients,” said Arthur Gottlieb, Managing Partner, Boston. “This well-deserved promotion acknowledges Frank’s leadership capabilities, exceptional transaction skills and strong work ethic. In addition to helping establish C.W. Downer & Co.’s Frankfurt office, Frank has also been integral in strengthening the firm’s sector expertise in the areas of Material Handling and Healthcare.”

Mr. Merkel has worked in the field of M&A for more than 10 years. Prior to co-founding C.W. Downer’s German operations, Mr. Merkel spent several years working for a German investment bank, where he focused on middle-market corporate finance transactions. Mr. Merkel studied at the International Business School in Bad Nauheim (Germany), where he received his Diploma in International Management, and he holds a Bachelor’s Degree in Business Administration from the University of Lincoln (UK).

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Cobblestone | Harris Williams is pleased to announce the sale of certain non-clinical assets of Christie Dental Practice Group, P.L. and Christie Dental Partners, Inc. (collectively “Christie Dental”) to American Dental Partners, Inc. (NASDAQ: ADPI). Cobblestone acted as the exclusive advisor to Christie Dental. The transaction was led by John Dickinson and Drew Flanigan of Cobblestone along with James Clark and Geoff Smith of Harris Williams & Co.’s Healthcare & Life Sciences Group.

“This transaction represents a tremendous partnership between two great companies, and it is an ideal outcome for both parties,” said John Dickinson, managing director at Cobblestone | Harris Williams. “We look forward to American Dental Partners’ and Christie Dental’s continued success in the future.”

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