Business Combinations? Much faster with partecipative financial instruments  

16/05/2020

The need to develop business combinations emerged in the context of “#RipartItalia, 100 ideas for recovery”, organized by Class Cnbc. These processes are realizable, but may have problems related to their duration. For example, an M&A process requires a medium-long period that is too long for business continuity in current circumstances. In Italy there are companies in crisis with difficulties in accessing bank credit, but there are also companies that have good financial strength. These companies can help the economic recovery by supporting business continuity of their network, supply chain or complementary ones.
In order to achieve this goal, various financial instruments already exist, such as participative financial instruments. The advantages for issuing and subscribing companies are the following: a) rapid obtaining of financing; b) more time to overcome the current difficult moment; c) integration with a solid company, without losing its corporate value;  d) helping companies deemed strategic; e) obtain a good return on the investment made; f) obtain constant monitoring of the investment and the issuer through administrative rights; g) have more time to evaluate and carry out aggregation processes (such as M&A).
This situation improves relations between companies of different sizes and belonging to the same sector, creating more collaborative relationships and bringing commercial, social, strategic and financial advantages.
Continuing your business within a larger group is better than letting it extinguish.

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