{"id":20484,"date":"2026-02-10T11:34:11","date_gmt":"2026-02-10T11:34:11","guid":{"rendered":"https:\/\/microvibenews.com\/?p=20484"},"modified":"2026-02-10T11:34:11","modified_gmt":"2026-02-10T11:34:11","slug":"strategic-benefits-of-mas-for-professional-service-firms","status":"publish","type":"post","link":"https:\/\/microvibenews.com\/?p=20484","title":{"rendered":"Strategic benefits of M&#038;As for professional service firms"},"content":{"rendered":"<p><\/p>\n<div>\n<p><iframe loading=\"lazy\" src=\"https:\/\/iframe.iono.fm\/e\/1644287?layout=modern\" width=\"100%\" height=\"170\" frameborder=\"0\" data-mce-fragment=\"1\"><\/iframe><\/p>\n<p>You can also listen to this podcast on iono.fm here.<\/p>\n<p><strong>SIMON BROWN:<\/strong> I\u2019m chatting now with PJ Veldhuizen, managing director at Gillan and Veldhuizen Inc PJ, appreciate the early morning. M&amp;A [Merger and Acquisition] activity is something that we always think happens between companies of billion-rand valuations, listed companies and the like. But in a recent article you put out you speak around M&amp;A activity happening around SMEs, professional service firms. It happens in smaller businesses as well and really can be beneficial for the companies.<\/p>\n<p><strong>PJ VELDHUIZEN:<\/strong> Yes. Good morning, Simon, and good morning to your listeners. Quite correct. One always believes what one sees in the movies \u2013 that these are things with Gordon Gekko, and greed is good, et cetera. But it happens all the time. Companies want to create efficiency, resiliency and sustainability. And with the level of regulation that we experience \u2013 not just in South Africa but worldwide \u2013 in order to create those efficiencies, one often sees strategic mergers where you can join up with like-minded people in like-minded firms and create synergies that can protect you going into the future.<\/p>\n<p><strong>SIMON BROWN:<\/strong> Absolutely. And the other point is really a great one \u2013 the sort of two businesses getting together and actually the sum of the parts is bigger. You plug some gaps that the one business has with the other.<\/p>\n<p>The other is two businesses which are both [pretty much] struggling. But you put them together and they\u2019re doing markedly better. A lot of those fixed costs would have been duplicated. That\u2019s another reason for a merger that can actually come out better as the two parts are together.<\/p>\n<p><strong>PJ VELDHUIZEN:<\/strong> Absolutely. So if you think of a vertical integration, for example, between a farmer and a packhouse \u2013 or a packhouse, farmer and a marketer \u2013 it\u2019s taking up the supply chain. That\u2019s something that\u2019s been around forever. But we\u2019re seeing it more and more now. As I say, one wants to create the efficiencies and be in control of the entire supply chain rather than relying on people, where everybody is trying to steal a buck here or there. It is so that you control that entire supply chain.<\/p>\n<p><strong>SIMON BROWN:<\/strong> You mentioned Gordon Gekko, and of course the whole point there was around greed is good \u2013 and risk, lots of risk. It\u2019s risk versus recklessness. There\u2019s a line there. Taking risk is not a no-no. It\u2019s around taking calculated risk in the M&amp;A space. That\u2019s the point that\u2019s critically important.<\/p>\n<p><strong>PJ VELDHUIZEN:<\/strong> Well, that\u2019s absolutely correct. And it\u2019s about critical thinking. It\u2019s about applying. I don\u2019t know if you\u2019ve read the book Clear Thinking by Shane Parrish \u2013 it\u2019s about applying one of the 100 mental models \u2013 the latticework that Charlie Munger talks about \u2013 about avoiding loss being better than trying to make gains. It\u2019s all about thinking clearly and understanding the risks that you\u2019re taking on.<\/p>\n<p>Look, you can never eliminate all risk, but if you if you apply your mind and you use the right professionals to assist you, you [can] work through it. Again, I say in my article \u2018Less haste, more consideration\u2019. Don\u2019t be forced into things. Don\u2019t be forced by other people\u2019s calendars to sign deals.<\/p>\n<p>If this deal is not right for you now, another deal will come along. It\u2019s about step-by-step analysing whether this deal is going to be good for you in the long term. And one of the mental models that I always like to use is second-order thinking. What are the consequences of what I\u2019m about to do? What are the tax consequences? What are the consequences for my employees? What is the merger of these two cultures going to be like?<\/p>\n<p>When you start looking about what happens next, it opens your mind as to as to whether there are true synergies here or perceived synergies in a deal like that.<\/p>\n<p><strong>SIMON BROWN:<\/strong> Absolutely \u2013 and making sure that there really is something there. You also talk around proper due diligence. It\u2019s more than just what the bank accounts look like. It\u2019s around IP, it\u2019s around contracts, leases \u2013 all those other bits. And often this really can get [down to the] nitty-gritty, but it\u2019s hugely important. And some of them could be deal-breakers if not properly aligned.<\/p>\n<p><strong>PJ VELDHUIZEN:<\/strong> Well, 100%. I always say one of the biggest things in any deal that you put together is: What does the divorce look like? If this doesn\u2019t work, how do you reverse? If there\u2019s a dispute, how do you deal with that? Let\u2019s be frank, the court system is an expensive option. It\u2019s a lengthy option and it\u2019s good really only for people like me \u2013 the lawyers.<\/p>\n<p>So if you if you set up the rules of how to resolve these things, I\u2019m a great proponent of mediation \u2013 commercial mediation that is \u2013 where business people can resolve things in a businesslike manner and try to keep the costs down and [arrive at] a resolution to something that can happen efficiently and quickly, as opposed to waiting five years to get into court, and then the appeal process that follows that. You may not know; maybe you\u2019re getting into bed with a charlatan who wants to use that system to their advantage, and you can then be the subject of intense abuse.<\/p>\n<p><strong>SIMON BROWN:<\/strong> I like that understanding. How does this break up if it doesn\u2019t work? Let\u2019s be real. Not everything works. I think it\u2019s an important point, a great point.<\/p>\n<p>We\u2019ll leave it there. PJ Veldhuizen, managing director at Gillan and Veldhuizen Inc, I appreciate the early morning time.<\/p>\n<p>Listen to the full MoneywebNOW podcast every weekday morning here.<\/p>\n<\/p><\/div>\n<p><script data-cfasync=\"false\">\n            !function(f,b,e,v,n,t,s)\n            {if(f.fbq)return;n=f.fbq=function(){n.callMethod?\n                n.callMethod.apply(n,arguments):n.queue.push(arguments)};\n                if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';\n                n.queue=[];t=b.createElement(e);t.async=!0;\n                t.src=v;s=b.getElementsByTagName(e)[0];\n                s.parentNode.insertBefore(t,s)}(window, document,'script',\n                'https:\/\/connect.facebook.net\/en_US\/fbevents.js');\n            fbq('init', '779812924991616');\n            fbq('track', 'PageView');\n        <\/script>#Strategic #benefits #MAs #professional #service #firms<\/p>\n","protected":false},"excerpt":{"rendered":"<p>You can also listen to this po&hellip; <\/p>\n","protected":false},"author":1,"featured_media":20485,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[4],"tags":[1927,290,12488,7824,80,1870],"_links":{"self":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/posts\/20484"}],"collection":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=20484"}],"version-history":[{"count":0,"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/posts\/20484\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/media\/20485"}],"wp:attachment":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=20484"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=20484"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=20484"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}