What Is Agglomeration
A unique type of collaboration where a group of SMEs from the same or similar industries join forces and list publicly on a global exchange.
Being part of a public-listed company means that you and your business will benefit from the shareholder value drivers associated with a larger public company - valuation, liquidity and scale.
An "Agglomeration" combines the best parts of a traditional M&A roll-up with the benefits of an IPO. The best way to illustrate it is as a type of cooperative IPD. A group of SMEs from similar or adjacent industries join forces to list publicly on a global exchange and then grow further through organic and inorganic activities.
Each business must be profitable and debt free, with similar or complementary services and be run by highly talented leaders in their field. To join the Agglomeration, each business owner exchanges shares in their business for publicly listed stock in the central holding company.
As part of an Agglomeration each successful business owner is given the freedom to continue to run their own business in their own way, helping to ensure that the talent that built the business in the first place continues to build the business in the future.
Agglomeration is a three step process as listed below
1. Create or source an appropriate Holding Company for the Agglomeration™.
2. Select mature, profitable, and debt-free businesses (a.k.a. subsidiaries) for the Agglomeration™.
3. Acquisition – under a special purpose vehicle (“SPV”) – of the respective subsidiaries by the Holding Company through the issuance of public-listed shares in Holding Company to original owners of the subsidiaries.