Houlihan Lokey’s Expansion in the Eur-Asian Market with a Focus on the Technology Sector

On October 4th, 2021 Houlihan Lokey acquired 90% of GCA’s common stock through a tender offer. The complete integration of the remaining 10% was finalized on December 6th, 2021. Houlihan Lokey made a c. $12.63 per share bid for GCA, resulting in an overall deal value of $595M.

Investment Considerations

As stated by Houlihan Lokey’s CEO, Scott Beiser: “The addition of GCA significantly expands our technology capabilities, which are critical to meeting the needs of our clients in an ever more technology-driven world. In addition, the strength of GCA’s platform in Asia-Pacific allows us to achieve scale and better serve clients in this rapidly growing region.” The exploitation of new markets and the enlargement of the technology sector will have a positive impact on the revenue generation and profitability of the firm.

Investment Banking, Small and Midcap

The acquisition by Houlihan Lokey had the aim of constructing a strategic position in the small and midcap investment banks, with the possibility to compete with Wall Street’s giants. The acquisition makes Houlihan Lokey the most active M&A Technology advisor in the world (with c. 300 deals in 2021).

Houlihan Lokey and GCA

The transaction has combined GCA’s 500 talented employees, to Houlihan Lokey’s family. Bringing with them their know-how with regards to the technology sector. The successful integration of the two firms is based on the similar business philosophy they share, built upon the belief of the importance of a strong client-centric corporate culture and the desire to constantly innovate.

Conclusions

GCA has been officially acquired for $595M by Houlihan Lokey as of December 6th, 2021 and operate under the Houlihan Lokey brand. Establishing a strong position in the European and Asian market where technology-related firms are growing at a fast rate and the possibility of M&A deals is rising. This is caused by the highly competitive landscape which firms are facing, putting them in a position to acquire or be acquired. The increased relevance of M&A deals can be demonstrated through the rise of global value of M&A transactions, which has reached a record high of $5.8T.

Read and download the full report here

Authors: Lina Bouzouba, Giuseppe Coviello, Luca Vitale

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