Pitch Best Small Cap Deal 2020: Corsearch – Pointer Brand Protection

De genomineerde deals maken dit jaar kans op de M&A Award voor Best Small Cap Deal 2020.

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Name of the deal Corsearch acquires Pointer Brand Protection
Date 29 January 2020
Published value € 5 – 50 million
Buyer(s) Corsearch
Target PBP Research 
Seller PBP Research shareholders

Involved firms and advisors 

Involved firms and advisors buy side:
KPMG (Financial Due Diligence), Baker McKenzie (Legal Advisory Corporate M&A), West Monroe Partners (Consultancy)

Involved firms and advisors target:
Improved Corporate Finance / Drake Star Partners (M&A Advisory), Amstone Tax Lawyers (Tax Advisory), Vriman M&A Lawyers (Legal Advisory Corporate M&A), Withersworldwide (Legal Advisory Corporate M&A)

Involved firms and advisors sell side:
Improved Corporate Finance / Drake Star Partners (M&A Advisory), Amstone Tax Lawyers (Tax Advisory), Vriman M&A Lawyers (Legal Advisory Corporate M&A), Withersworldwide (Legal Advisory Corporate M&A)


Brief description deal / Deal outline
Corsearch, an American brand protection company, has acquired Pointer Brand Protection(PBP), a Dutch online brand protection company. Corsearch is a portfolio company of the Audax Group, an American private equity company. The acquisition has been done in order to strengthen its position in the Online Brand Protection industry. 

Why should this deal win the Award for Best Small Cap Deal 2020?
Pointer Brand Protection, an Amsterdam headquartered prominent provider of anti-counterfeiting and (online) brand protection services, announced its acquisition by Corsearch, a portfolio company of Audax Group (US Private Equity fund $26B AUM). Drake Star Amsterdam acted as the exclusive financial advisor to the shareholders in Pointer Brand Protection. 

The acquisition further extends Corsearch’s fast-growing brand protection offering and provides a comprehensive new service for brand owners and legal professionals. For the first time, a consolidated suite of technologically advanced solutions will support the research, clearance, monitoring, and enforcement needs of the brand lifecycle. Online security and authenticity are some of society’s biggest challenges and we foresee a huge necessity for category leaders or the companies who want to become leading, to strengthen their position through M&A and/or investment processes. We are excited to see the great team at Pointer Brand Protection join forces with Audax-backed Corsearch to create an integrated solution for protecting brand value and integrity. 

Corsearch’s/Audax’ knowledge, expertise, network, and value-creating support in achieving this is unmatched; with this deal, we once again displayed that IMPROVED Corporate Finance/Drake Star Partners is becoming the hub for connecting high-profile US acquirers to our very innovative Dutch technology growth companies in a very competitive, value-enhancing, efficient process. 

Deal rationale:
From counterfeiting and piracy to grey trade and brand impersonation, estimates suggest that a staggering one in four online purchases involve brand infringement. With global eCommerce expected to reach 4.5 trillion U.S. dollars by 2021, the need for online brand protection to fight these threats has never been more urgent. It is an issue that is growing in tandem with total global trade, with some reports projecting that by 2022 counterfeiting and piracy could result in the loss of 4.2 trillion U.S. dollars and the endangerment of 5.4 million legitimate jobs. 

A global problem needs global solutions, and the addition of Pointer Brand Protection into the Corsearch family aligns the technological capabilities and extensive networks of the entire group into a brand establishment and protection provider with unmatched coverage. Consolidation is an ongoing trend in the Brand Protection space. Pointer BP was one of the very few sizable independent players left. Because of Pointer's leading technology stack and profitable approach to growth, it was a competitive race of strategic buyers trying to acquire Pointer.

What is the impact of this deal for the company?
Since 2008, Pointer has worked with hundreds of globally renowned brands to protect them from infringement and abuse. The industry is becoming more challenging every day and brands require technologies and services that can outpace that. 

Joining forces with Corsearch means securing the ability to innovate in a way that anticipates the needs of customers while also benefiting from Corsearch’s trusted industry presence. Pointer BP's employees, the brightest minds in online brand protection, will be retained and are now part of a global organisation with increased personal development opportunities in order to define the future of this industry.

What is the impact of this deal for the direct stakeholders?
For many businesses, the digital environment has become so complex that establishing and protecting brands is too fragmented and time-consuming to be manageable. To combat this effectively, brand owners and legal professionals require technological leadership and innovative solutions to implement a strong, proactive brand protection program.

The Corsearch Brand Protection platform will provide an entirely new service offering which combines the very best teams, expertise, and technologies from both Pointer and from previous Corsearch acquisition, Yellow Brand Protection.

In addition to Corsearch’s existing services, the new platform will provide brands with a full-service solution combining everything from trademark research and clearing to machine learning, automated marketplace enforcement, and end-to-end investigations. To fight infringements at their source, the new team will also include the largest China-based online brand protection department in the industry. With this strategic acquisition, Corsearch becomes the only provider to support the needs of IP and brand professionals throughout the trademark lifecycle.

What is the impact of this deal on society?
Pointer BP joining forces with Corsearch will ensure the continuous elimination of counterfeit products and IP infringements on the web. Through these solutions, society will be able to purchase goods on the internet with a clear conscience as they can trust the goods are legit. Please also refer to deal rationale.

What was most complex about this deal?
Pointer’s founding team and shareholders engaged Drake Star’s technology-focused advisory services when Audax/Corsearch was already at the table to discuss a potential acquisition of Pointer. Drake Star was tasked with creating a competitive process within a very short time. To do so, Drake Star put together documentation including a compelling and tailored equity story for each potential buyer. On the one side, to obtain additional offers, and on the other side, to drive up the valuation in Audax’ offer justified by Pointer’s added value and potential synergies. In general, the complexity lies in the highly competitive cross-border nature of the process dealing with many buyers, offers, and timelines. Several parties were trying to pre-empt the process, and it took some creative stalling techniques to align all buyers and offers in order to maximize the valuation for the selling shareholders. 

Lastly, dealing with US Law increased deal-complexity as additional legal and tax advisors needed to be onboarded and managed to meet the timelines.

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