Acquisition initiative: accelerate your expansion

As part of its Acquisition for Accelerated Growth initiative, the Chamber is organizing three events with different objectives.

First, to equip SME managers and entrepreneurs so that they can continue their expansion through acquisitions. Second, to highlight the success of our leading companies that stand out in the marketplace and inspire SME managers to take their organizations to a new growth stage.

This series of events includes “Business Clans” networking meetings, designed to encourage dialogue between entrepreneurs who share an interest in acquisitions, as well as a springboard forum to equip SMEs to succeed in their acquisition projects. A business luncheon during which Quebec’s brightest jewels will share their acquisition success stories will close this series on October 25.

Find out why you should take part.

An economic environment conducive to growth

Quebec's economic indicators show that the economy is operating at its full potential: GDP growth reached a record high of 3.5% in Montréal in 2017. For 2018, the outlook for GDP growth in Quebec is around 2%.^[1] In addition, the unemployment rate is at an all-time low of 5.6% in Quebec and remains at 6% in the metropolitan area. At the same time, low interest rates make it easier to access financing. In addition, Quebec's financial ecosystem is performing well: banks and investment funds have the capital to support entrepreneurs towards the next stage of their growth.

Companies are taking advantage of this strong economic climate and investing. The year 2017 broke records in the global acquisition market. More than 2,000 transactions took place in Canada, and Quebec is following the same trend. According to a survey conducted by the Chamber in May 2018 on the intentions of the city's executives regarding acquisitions, more than one in four SME managers have already made at least one acquisition.

An increase in acquisitions by Quebec companies would accelerate the growth of our economy and encourage the creation of new local champions.

Quebec companies and acquisitions: a myth to debunk

Quebec companies are more aggressive on foreign markets than the other way around. This reality is at odds with the perception that our companies are instead more often bought by foreign companies. According to recent government figures, Quebec companies have carried out 375 transactions worldwide since 2010. However, 102 Quebec companies were purchased by foreign companies during the same period.^[2] This data shows that Quebec is a winner in the acquisition market. For every Quebec company purchased by a foreign company, Quebec acquires three times as many companies. These transactions totaled $266 billion between 2010 and 2018. For the same period, transactions leading to the sale of Quebec companies to foreign interests totaled $60 billion.

Increasing the number of SMEs that become large corporations

In Quebec, the economy is mainly composed of SMEs. Indeed, 92% of them provide the total employment in the private sector. However, they face three major challenges:

• The difficulty of moving from SME to large company: between 2000 and 2014, only 41% of SMEs grew to become large companies (over 500 employees).^[3]
• The challenge of sustainability after a generation: only 30% of SMEs pass the first-generation mark and 10% the second-generation mark.^[4]
• The lack of succession of business managers in the context of a demographic crunch: between 5,700 and 10,000 Quebec companies will have to find a new owner by 2024 because of the lack of succession.^[5]

However, the challenges faced generate business opportunities for entrepreneurs who consider acquisition as a growth strategy. 

Business acquisition to help you grow and meet your goals

Does your company face talent-related challenges? Are you planning to acquire new technologies? Would you like to access new markets or diversify your service offering? Have you accumulated passive capital and want to move on to the next stage of growth? The acquisition of a business could both meet your needs and give your business a new lease on life.

The Chamber will highlight the success of our leading businesspeople at a luncheon on the subject of acquisitions on October 25. During this event, benefit from the experience and advice of large company leaders who have made an acquisition that promotes their growth and development, both here and abroad.

Take part in the October 25 business luncheon and learn from the experience of our economy's finest entrepreneurs to take your business to a new level.