Rudy Scarito on Manufacturing M&A

Manufacturing M&A Should be Elements of Every Industrial Companies Strategy Discussions - Rudy Scarito on Middle Market Transactions

Rudy Scarito may be soft spoken, but she is a relentless competitor. She plays to win - from her time as captain of the Dartmouth soccer team, to her early roles as public company independent director when women on boards were unusual, to her work today as an advisor and advocate for lower middle market industrial companies considering a sale or acquisition, and even the way she challenges herself each time she climbs on her Peloton.

Her background in transactions and capital markets began traditionally - Harvard MBA, Goldman, Lehman and other prominent firms. She started to challenge the status quo by taking seats on public boards when most directors were men.

Then the GFC opened up a new opportunity - for Rudy to set up her own boutique investment bank. She hasn't looked back, and has built a track record of sell-side success for industrial firms.

Listen to our conversation to learn why she's known as "The Scrap Metal Lady", and her simple advice for industrial company boards of directors - strategy should routinely consider two kinds of transactions; to sell or buy.

Connect with Rudy if you're an industrial company owner, board director, or executive wondering how a good investment banker can help you think more strategically about manufacturing M&A.

Website and a representative list of Rudy's industrial transactions|   

Why Every Company Should Consider Two Types of Transactions Constantly - Rudy Scarito on Industrial Growth Insitute Episode 24

Show Transcript

Episode Recap

Summary

Rudy Scarito, an investment banker with extensive experience in mergers and acquisitions, shares insights on the importance of considering acquisitions and exits as part of a business growth strategy.

She discusses the current market trends, including the silver tsunami of baby boomer business owners looking to sell, and the opportunities for growth through acquisitions.

Rudy emphasizes the need for business owners to proactively think about transactions and engage in strategic planning. She also highlights:

• the role of advisory boards, lawyers, and accountants in guiding companies through the transaction process
• the process of buying and selling businesses
• role of investment bankers, and the importance of preparing for a transaction
• need for business owners to have a clear understanding of their goals and to seek the assistance of professionals who specialize in mergers and acquisitions.

Scarito also highlights the importance of vetting investment bankers and selecting the right fit for a company. She discusses the benefits of having a well-structured board of directors and the value that independent directors can bring to a company. Rudy concludes by discussing the current state of private equity and the potential impact of economic and political instability on transactions.

Takeaways

• Acquisitions and exits should be considered as part of a business growth strategy.
• The lower end of the middle market is currently active, with many baby boomer business owners looking to sell.
• Business owners often need a catalyst, such as a medical issue or a desire for a different lifestyle, to prompt them to consider selling.
• Companies should proactively think about a range of manufacturing M&A transactions and engage in strategic planning, including identifying potential acquisition opportunities and evaluating financing options.
• Business owners should have a clear understanding of their goals when considering buying or selling a business.
• Seek the assistance of professionals who specialize in manufacturing mergers and acquisitions to navigate the complex process.
• Vet investment bankers and select the right fit for your company by asking questions and seeking recommendations from trusted sources.
• A well-structured board of directors with independent directors can provide valuable insights and guidance.
• Private equity is a viable buyer for middle market industrials and is likely to remain so for the foreseeable future.
• Consider the potential impact of economic and political instability on transactions and plan accordingly.

Takeaway Quotes from Rudy Scarito

• "It's fraught with peril. I would say unless it's a very simple deal, most business owners should seek the assistance of a professional who focuses and specializes in this."
• "I believe that strategy should consider two kinds of transactions routinely."

Outline

Does Your Board of Directors Bring All the Important Inorganic and Organic Growth Perspectives Your Company Needs?

Check out the Board Directors' Boot Camp and the Overall Revenue Effectiveness™ Framework which includes Board Oversight and Strategy.