Positive pivot: how to turn M&A setbacks into opportunities

In the high-stakes, unpredictable world of mergers and acquisitions, not every hand you’re dealt is a winning one.

The past couple of years have been especially challenging, with obstacles such as slow economic growth, volatile markets, and global unrest leading to an increase in delayed or failed transactions.

At LAVA, we’ve celebrated many wins, but we’ve also encountered deals that didn’t go as planned. When this happens, we don’t sit back. Through the resilience, creative thinking, and problem-solving skills of our team, we commit to finding new ways to achieve the best M&A outcomes for our clients.

That’s what happened recently with our AIRDAT deal.

Reimagining M&A success routes

AIRDAT, set up in 2006 by Charles Cardwell, is a leading provider of airport safety systems, training, and consultancy services.

When Charles decided to step away from his role as CEO and sole shareholder, he was approached by several parties interested in private sales. LAVA helped Charles navigate these offers and an initial agreement was reached with a private equity backed buyer.

After this first deal fell through, the LAVA team regrouped and restrategised, guiding AIRDAT to a new deal that worked even better for Charles and his workforce.

As a key player in the AIRDAT deal, LAVA Executive Millie Counsell sheds light on how we managed to turn the situation around with three main takeaways.

Turn setbacks into opportunities

When a deal doesn’t work out, revisiting your objectives isn’t just a reflective exercise—it’s a strategic necessity. This is the moment to reassess your goals, pinpoint what really matters, and think about new ways to get there.

For AIRDAT, a company already renowned for its progressive steps in workplace culture, like the introduction of a four-day working week, this period of introspection became pivotal. It was during this time that LAVA introduced the concept of an Employee Ownership Trust (EOT) as an exceptionally fitting choice for AIRDAT.

Drawing from our previous encounters with EOTs, we saw a natural alignment with the unique culture Charles had nurtured at AIRDAT. Given that level of workplace maturity, we were confident the EOT could help Charles achieve his personal goals and pave the way for AIRDAT’s exciting next chapter.

Apply creative thinking to deep knowledge of the client

In the complex world of M&A, your advisors should not only be experts in the industry but also deeply knowledgeable about your business. A real grasp of a client’s operations allows the advisory team to come up with solutions that deliver the best results for specific needs and objectives.

Having invested time upfront to understand Charles and the intricacies of AIRDAT’s business, when the first deal didn’t materialise, we were able to swiftly devise alternative creative solutions that resonated with his distinct aspirations.

Communicate change to the wider team

Effective communication is essential when making a shift in M&A strategy. We need to be clear about our new direction and how this change can address current challenges.

It was crucial to reassure Charles that the initial deal, even though it fell apart, wasn’t a waste of effort. In fact, it set the stage for an even better outcome. We took our time explaining the new approach and EOT model to Charles, detailing the commitments involved and discussing ways to address potential worries. Being transparent was key.

But open dialogue shouldn’t just happen in the boardroom. We co-hosted a company-wide briefing the day after the deal completed to discuss the upcoming changes, providing a great open environment for people to ask questions.

Keeping everyone in the loop following a deal is crucial to ensuring the entire team feels positive and is prepared for the company’s next phase.

To sum it up…

Our journey with AIRDAT highlights our belief that with the right guidance and approach, potential setbacks can evolve into standout opportunities.

With our leadership, AIRDAT navigated some real M&A challenges, and Charles was thrilled with the results, stating, “Choosing LAVA as our advisors was the best possible decision for AIRDAT’s future.”

For companies diving into the complex world of M&A, it’s essential to forge strong relationships with advisors who are both knowledgeable in M&A and deeply understand your business. Keeping an open mind and maintaining clarity about your goals can turn potential hurdles into valuable prospects.

Interested in crafting your M&A success story? Get in touch with our team today to explore creative solutions tailored for your business.

LAVA Advisory Partners

LAVA is an M&A advisory and corporate finance consultancy with a passion for creativity in the deal environment. We enjoy exploring M&A theses and pitching consolidation ideas in sector verticals where we see opportunity for value creation.

Having a strategic vision – however left-field it may be – and exploring the ramifications of it, is a central part of what we do. We are a diverse team of passionate dealmakers who share our vision for deal making in an ever changing M&A landscape.

We could stop at adequate, but we won’t.

A positive difference

LAVA is very proud to have achieved B Corp certification.
This means we have joined a growing group of companies and leaders that are reinventing business by pursuing purpose as well as profit. By demonstrating the highest standards of social and environmental impact, including committing to donate 2.5% of our revenue each year to support charitable organisations, we aim to show our commitment to using business as a force for good.