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Family businesses are the most common structure of business organizations around the world. Big brands had a family origin, like Samsung for example. And we also have national examples, such as Grendene, Votorantim and Weg. In addition to the strength of these brands, successful family businesses seek to leave a legacy built over time and apply their family identity and culture to the company.

According to recent data from IBGE, in Brazil, 90% of companies are family-owned. But IBGE’s own estimates (and also those of the World Bank) on the survival rate of family businesses to generational succession are worrying: only 30% of them survive to the second generation and 15% survive to the third. Furthermore, only 25% of companies, in general, survive for more than 10 years in Brazil.

These data show that the central point for companies (family or not) is whether they will remain competitive. And to achieve this, companies need to adopt different strategies, including “mergers and acquisitions”.

But in addition to the company’s longevity, there are other factors that lead a family business to think about mergers and acquisitions strategies: when partners want to retire, when there is a lack of interest in the business from the next generation, corporate disagreements and even the most serious issues strategic, such as gaining economies of scale, entering new markets, acquiring qualified professionals (which, depending on the industry and the current situation, can be very time-consuming and difficult), among others.

Once the partners understand that it is essential to think about this topic, and they decide to move in this direction, then comes the need for a specialist on the topic. Mergers and Acquisitions consultancy will allow partners to remain focused on the company’s main business while the process takes place. A specialist will be able to help design the thesis with which they will go to market, and has the appropriate knowledge to evaluate companies’ finances, their real value, evaluate contingencies, bring competition to negotiations, among many other aspects.

We at Providência Capital are open to talking about these topics if you have a company and are thinking about these issues. We have a solid history of companies advised in this process, family or not.