MERGERS & ACQUISITIONS
German company . That ended up going bust , and Murray , who could have retired , bought his company back in 2008 . But he still wanted to grow his business and install more solar energy throughout the Western U . S . He realized this goal after meeting with Virginia-based Sigora Solar , which acquired Aztec Solar in October 2020 .
One of Murray ’ s demands for the deal was to make sure his 40 employees wouldn ’ t be left out to dry . The deal with Sigora includes a three-year contract for him to serve as president of the West Coast division and help with the transition .
“ I ’ ve seen what can happen when companies go down and warranties aren ’ t taken care of ,” Murray says . “ I want to strengthen consumer protection , get certification for installers , write building codes in state . I know what it takes to make an industry stay in good stead over time , and I want to make sure that when I leave , solar ( energy ) goes on , not only in the state , but the country and world .”
Stronger together
Most companies say synergy is the reason for a merger : The combined unit as a whole is superior to the sum of the parts , Eminli says . One source of synergy is that joining together would allow the companies to lower their costs because they can eliminate duplicate costs , such as facilities , equipment , research and development , and advertising .
This type of collaboration allows two companies to work more efficiently as one unit than they would separately , Eminli says . Company A might have valuable know-how and patents that company B could use in conjunction with its own know-how to develop and bring a new or higher quality product to the market .
Eminli believes this could be the motivation behind Lockheed Martin acquiring Aerojet Rocketdyne for $ 4.4 billion in December 2020 . Aerojet Rocketdyne sources declined to comment on the deal until the acquisition becomes official , expected this month .
In October 2020 , Allworth Financial sold controlling interest to Lightyear Capital and the Ontario Teachers ’ Pension Plan , and the deal closed last December . Allworth Financial co-CEOs Scott Hanson and Pat McClain , who
“ One of the major economic impacts of the COVID-19 pandemic has been the structural shifts it has caused in the business environments of many of the industries . Firms that are not able to cope with this changing environment have to exit the market , which creates room for further consolidation through mergers and acquisitions .”
VUSAL EMINLI Associate professor of finance , University of the Pacific ’ s Eberhardt School of Business
founded the company in 1993 , will continue to manage Allworth .
About four years ago , they were looking to add capital and sold a majority stake to Parthenon Capital . Since then , they have done 12 acquisitions , so this is old territory for the duo . They hired an investment banker to go through the process . The concept of a private-equity partner gets a bad rap , Hanson says , but their current partners are growth investors , providing oversight and capital . He adds that this new deal puts Allworth in a position to bring on 1,000 new clients this year in various markets and have between
12 and 15 acquisitions , mainly on the West Coast , by year ’ s end .
The company rebranded two years ago , changing from Hanson McClain Advisors to the more neutral name of Allworth Financial . The Hanson McClain brand was known in Sacramento , but if it wanted to build a national firm , Hanson says , it needed a name that could resonate with more clients all over . “ This clearly wasn ’ t us selling out to anybody , that ’ s for sure ,” he says .
A generational shift
But in some cases , a merger is the best option . Sometimes a company ’ s managerial structure is lacking , and outside support is necessary . Or a company can be marred with poor management and become a target for acquisition . For Lyon Real Estate , a fixture in Sacramento for 75 years , the future was at stake . The company was acquired in January by Seattlebased Windermere Real Estate .
This has been something the family has entertained for the past few years , according to Pat Shea , president and chief operating officer of Lyon Real Estate ( formerly run by real estate mogul Michael Lyon before legal troubles landed him in jail ). The pandemic caused a two-month interruption for all companies in the real estate business across the country , but real estate bounced back with a vengeance , he says , especially in Sacramento because of low interest rates , increased migration from the Bay Area , and solid employment numbers among typical homebuyers and sellers .
This deal was more a strategic decision , as the family didn ’ t have the next generation lined up to take over , Shea
46 comstocksmag . com | April 2021