Investment Criteria
AMT is a specialty niche group that invests in the purchase of smaller companies, “orphaned” companies, and “non core spin-offs” with valuations up to the hundreds of millions of dollars that fit into AMT’s targeted industries. These include companies in the aerospace, advanced composites and chemical industries. It is not an investment entity seeking very large acquisitions valued in the billions of dollars. Because AMT seeks smaller companies to invest in, it is able to conclude many acquisitions in a very timely manner. AMT’s investment partners are high net worth individuals, smaller private equity funds, and carefully selected venture capital funds.Potential investment partners will be presented with a defined, target specific opportunity. Separate LLCs are set-up such that profits flow through tax-free to investors.
Acquisition financing is typically structured in approximate thirds. One third is equity. The second third is subordinated debt and the balance is secured lender debt. AMT’s co-investment with the other equity investors is at an equal valuation for all. Recently, the equity component has been increased reflecting the current financial reality in the lending industry.
AMT provides management expertise to its acquired companies for a negotiated fee typically, less than one percent of invested capital compared with the usual two per cent associated with the traditional hedge funds. In addition, since the acquisition is on a “debt-free basis,” working capital credit lines are used for conventional bank loans, usually from local lenders. Equity investors are usually represented on the Board of Directors of the acquired company, and receive negotiated shareholder’s rights. A three to five year time frame until exit and monetization is usual.
Operating management, including acquired managers is incentivized by stock with ownership vesting over a three-year period tied to performance metrics. On full vesting these shares will represent up to thirty per cent of the fully diluted equity.
The Father of Modern Chemistry:
"The father of modern chemistry” is recognized as Antoine Lavoisier (1743-1794), a French nobleman prominent in the histories of chemistry, finance, biology and economics. He developed his law of conservation of mass in 1789 (Lavoisier’s Law). This discovery dealt with the kinetic theory of gasses. He regarded heat as a form of motion and stated the idea of the conservation of matter. His methodology allowed for the science of chemistry to take on a strict quantitative nature, enabling reliable predictions to be made (Wikipedia, 2008 and William H. Brock, The Fontana History of Chemistry, Fontana Press, 1992).