Strategy
An add-on acquisition is a smaller company bought by an existing platform company and combined into it, which adds customers, services or locations.
An add-on acquisition is a purchase made by a company that a private equity firm already owns. The smaller target joins the larger business. The goal is more customers, new services, new regions or lower costs per unit.
For example, a platform company with six offices buys a competitor with two offices. The platform shares back-office work, cross-sells services and serves a bigger customer base.
If you own a smaller company, an add-on can be a good fit. You join a larger team that has money, systems and a plan. Your fit depends on culture, services and location.
Capstreet publishes "200+ Add-on Acquisitions" and "50+ Platform Acquisitions" as part of its record. It describes its Capvalue Framework® stage "Drive Business Transformation" as including a plan to "Execute buy and build strategy". Add-ons sit on top of a platform company and form the core of buy and build. Learn more at buy and build strategy.
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