Transactions

November 2010
El Segundo, California
has been acquired by
Englewood, Colorado


Background

iSuppli Corporation, the California-based global leader in technology value-chain research and advisory services approached Marlin & Associates with a challenge. Six months earlier, they had agreed to acquire Screen Digest, a London UK-based firm that operated in an analogous field. The deal was subject to a financing contingency, and iSuppli had been trying to raise the required capital - $20 million - on its own – in a tough environment. iSuppli's existing shareholders, including Goldman Sachs’ Hudson Street group and two other financial sponsors were constrained. Goldman wasn’t making follow-on investments; and the other two firms were at end-of-life and prohibited from making additional investments. Time was running short; iSuppli had four months to raise the capital and complete the acquisition or it was likely to lose the opportunity.

M&A rapidly put together a team of seasoned bankers and worked with the company to prepare a detailed Confidential Information Memorandum that described both iSuppli and Screen Digest; the potential for each to grow substantially on their own; and the synergies between them. Then Marlin approached a select group of financial sponsors and strategic firms. Management meetings were held and bids solicited.

With 90 days to go, several financial sponsors expressed interest in supporting iSuppli and its Screen Digest transaction at valuations and terms that were acceptable to the iSuppli board. In addition, two strategic firms indicated interest in acquiring 100% of iSuppli together with Screen Digest, at values significantly higher than those indicated by the financial sponsors. However, these values were still less than the value that some iSuppli board members had determined would be required for a complete exit. Some board members didn't want to sell at all (now). Further, Management was optimistic about the future and - as the holders of considerable amount of stock options – leaned towards working with a financial sponsor for a few more years before exiting.



There were myriad challenges in executing this transaction: complete two acquisitions simultaneously with one firm in California, one in London and a buyer in Colorado made it enough of a challenge. Completing two simultaneous deals under intense time pressure added to the stress levels. Getting consensus from a board made up of members with diverse agendas and not the same objectives added to the complexities. The buyer identified was not willing to pay what the sellers were asking.

The key to success was motivating one of the strategic buyers to increase its bid, without losing the financial sponsors as back up. M&A worked with the bidders and the company to produce pro-forma historical financials, and projections as well as a pro-forma organization for the new company. Synergies were quantified and extensive due diligence managed. Eventually, M&A was able to get IHS to increase its bid sufficiently such that the iSuppli Board agreed to a transaction. On December 3rd 2010, IHS announced the acquisition of iSuppli, and the near simultaneous acquisition of Screen Digest by iSuppli.

Marlin & Associates managed the process, assisted in the negotiations and acted as exclusive strategic and financial advisor to iSuppli.

iSuppli agreed to be acquired by IHS

November 02, 2010
IHS to Acquire iSuppli Corporation 
November 2, 2010 

IHS Inc. (NYSE:IHS), a leading global source of critical information and insight, today announced it has signed a definitive agreement to acquire iSuppli Corporation, the global leader in technology value chain research and advisory services. The transaction is expected to be completed on or before November 15, 2010.

“This acquisition is an excellent complement to the existing IHS Product Design and Supply Chain business, and further builds our position as a key information provider in the electronics, manufacturing and supply chain markets,” said IHS Chairman and Chief Executive Officer Jerre Stead. “Combined with the IHS electronic components information business, and our global commodity and economic outlooks, customers will have access to a full suite of robust information services across the entire electronics value chain."

iSuppli is the global leader in electronics technology research and advisory services serving a wide variety of market segments including computer platforms, automotive, consumer electronics and both wired and wireless communications. Product offerings range from electronic component research to device-specific application market forecasts, from teardown analysis to consumer electronics, and from display device and systems research to hardware design forecasting.

iSuppli serves companies involved in high-tech services, consumer electronics, multi-national industrial conglomerates, financials, and governments. iSuppli has successfully expanded their capabilities to encompass the full electronics value chain from fundamental electronic component supply to end-market demand. This complete value chain view is critical to operating and investment decisions of electronics manufacturers and across many core IHS market verticals which rely on electronics and electronic components.

“iSuppli was founded with a dedication to helping our clients improve performance in the electronics value chain by providing facts and analysis for success,” said iSuppli President and Chief Executive Officer Derek Lidow. “Our business strategy, team of industry veterans combined with our strong commitment to customers and colleagues are excellent complements to IHS, and we look forward to joining with them to deliver the most accurate and trusted electronics information and insight to customers around the globe.”

Stead added: “Taking advantage of existing IHS expertise, the acquisition of iSuppli will help us develop new products and services for a variety of the vertical markets we serve. In addition, we are acquiring an important asset base of analysts and researchers, as well as customers across Europe, in China, Japan, Korea and Taiwan.”

The acquisition of iSuppli is subject to closing conditions contained in the definitive agreement.

Marlin & Associates acted as exclusive strategic and financial advisor to iSuppli’s Management, Board and shareholders, including Goldman Sachs, Covidien, CMEA and NeoCarta.

About IHS


IHS (NYSE: IHS) - www.ihs.com - is a leading source of information and insight in pivotal areas that shape today’s business landscape: energy, economics, geopolitical risk, sustainability and supply chain management. Businesses and governments around the globe rely on the comprehensive content, expert independent analysis and flexible delivery methods of IHS to make high-impact decisions and develop strategies with speed and confidence. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS employs more than 4,400 people in more than 30 countries around the world.

IHS is a registered trademark of IHS Inc. All other company and product names may be trademarks of their respective owners. Copyright © 2010 IHS Inc. All rights reserved.

About iSuppli Corporation


iSuppli Corporation is the global leader in technology value chain research and advisory services. Services afforded by iSuppli range from electronic component research to device-specific application market forecasts, from teardown analysis to consumer electronics and from display device and systems research to automotive telematics, navigation and safety systems research. More information is available at www.isuppli.com and by following us at twitter.com/iSuppli.

About Marlin & Associates

Marlin & Associates Holding LLC is a boutique investment banking and strategic advisory firm specializing in acquisitions and divestitures of U.S. and international middle-market firms that provide technology, digital information and healthcare-related products, technology and services. The firm is headquartered in New York, NY and has additional offices in Washington, DC and Toronto, Canada.

Marlin & Associates Securities LLC, a wholly-owned subsidiary of Marlin & Associates Holding LLC, is a broker-dealer registered with the Securities and Exchange Commission and is a FINRA/SIPC member firm (www.finra.org). Investment banking and/or securities are offered through Marlin & Associates Securities LLC. Marlin & Associates' professionals have advised on more than 200 successfully completed transactions. More information is available at www.MarlinLLC.com.

Back to Top