Logistics and Business Services Capital (LBSC) History
LBSC was founded in 2012 as a successor company to MergeGlobal, Inc. Its founder, Jim Westphal, brought a unique combination of investment banking, strategy, and industry expertise to solving clients’ strategic challenges. Jim also brought the view that, too often, investment bankers take a narrow approach to supporting clients by focusing primarily on “processing” transactions rather than considering the transaction within the context of shareholders’ longer term strategic and financial objectives and alternatives.
Logistics and Business Services Capital Approach
LBSC provides its clients with three advantages not emphasized by large investment banks:
1. Real industry expertise
2. Dynamic strategic perspective
3. Creative thinking tailored to each situation
Real Industry Expertise
LBSC has a narrow but deep industry focus. LBSC’s team has spent years largely dedicated to these sectors. Our conceptual and quantitative approaches are balanced with a practical understanding of what is possible in our sectors, enabling us to better understand issues such as valuation and capital structure. We know the buyers, sellers, and investors and have personal relationships with leading industry decision makers. As a result, we are not forced to contact and screen long lists of acquisitions or targets, thus avoiding wasting resources and overexposing our clients. We can make rifle shot approaches on the targets we know who would be most amenable to a transaction and the best partners for our clients. And we understand how a company’s commercial capabilities relate to valuation and transaction interests.
Dynamic Strategic Perspective
LBSC’s team has worked not only in executing financial transactions but also in strategy. When we work with clients on a potential sale, for example, we help them understand long term valuation issues based on (i) where the company is currently going; (ii) how the company could change its strategy to increase its value; and (iii) how this longer term value compares to what is currently achievable in an M&A context. We have often worked with clients for as long as several years assisting them in making acquisitions, forming partnerships, and developing growth strategies before exiting at an enhanced valuation. (See “Atlantic Aviation: Building Value Before a Sale”.)
Creative Thinking Tailored to Each Situation
LBSC does not apply a “cookie cutter” approach to problem solving and believes in questioning conventional industry thinking. We believe that too many companies and investors react to a Wall Street “echo chamber”, focusing on what others are saying and repeating rather than on long term fundamental financial and strategic issues. We predicted, for example, how many of the so called “asset-light” logistics companies were unable to shed their supposedly variable cost structure during the last industry downturn whereas many “asset-based’ companies (e.g., truckload carriers) were able to adjust. (See “Truckload Carrier Case Study: Going Against the Conventional Wisdom”.) We do not assume that the standard broad based auction is always the best means for maximizing value in a sale process or that “now” is always the best time to sell or buy. LBSC creates flexible, adaptable strategies for its clients to maximize value.
LBSC provides its clients with advice integrating the above approaches for clients (particularly founder-owned and privately held entities) emphasizing long term value creation with market opportunism. We often work with our sell side clients for several years, assisting in strategic development and planning for an exit in which the client can best choose the timing and manner in which it monetizes its investment.
