The role of a senior advisor at FOCUS Investing Banking is to provide strategic advice and guidance to clients on various financial transactions. Senior advisors play a key role in client relationship management, strategic advisory, market research, networking, team collaboration and risk management. Senior advisors are seasoned professionals with extensive experience in a specific industry. They bring a wealth of knowledge and insight to the table, contributing to the success of the clients they serve. FOCUS Senior Advisor Michael LeVasseur has been in the automotive collision repair industry for the past 48 years, dating back to his junior year in high school. After graduating from Thaddeus Stevens College of Technology in Pennsylvania, he joined a multi-franchised dealership, where he spent the next 13 years as a technician and body shop manager. In 1993, he opened the first expansion shop of Keenan Auto Body, Inc. In 2001, while operating five locations, he was promoted to partner, and assumed the role of Executive Vice President and COO. Prior to the sale of the company to ABRA, now Caliber Collision, he was president and COO, operating 12 facilities encompassing two states, with sales exceeding $30 million. In May 2015, Keenan Auto Body hired FOCUS to represent it in its sale to ABRA . After the sale, LeVasseur assumed the role of Director of Corporate Development for ABRA, and then Caliber Collision. Mike joined FOCUS as a senior advisor in 2020. He brings his ownership experience in the collision industry to help other owners sell their companies. In addition to his work at FOCUS, Mike works as a collision industry advocate, helping people understand the industry. He can be reached at [email protected]. Strategic Advisory Approach: When advising clients in the automotive aftermarket/collision sector, what is your typical strategic approach? More specifically, how do you tailor your advice to align with the unique dynamics and demands of this specific industry from a senior advisor perspective? What does the senior adviser bring to both FOCUS and the business owner? My job as a senior adviser is to coach the owner to make sure they are comfortable and to guide them. It’s really about trying to know the owner, recognizing what makes them tick, what buttons to push, but really knowing what to do to keep them in the game and to direct them back to what their focus should be on rather than what they don’t need to be concerned about. It’s really just directing their focus back to what they’re trying to accomplish. There are some business owners who want to work with other business owners who have already been through the process and been in their shoes, like myself. They are passionate about the business, and so we have that connection. I’m there so the business owner feels comfortable. I understand the pain of selling your business, the emotional ups and downs of it. I have the experience and insight into the process. What advice would you give prospective business sellers? Sometimes people don’t realize they need a broker. Unless you, or someone on your team (whether it’s your attorney or your accountant), has been through this process before, you need someone there who knows not just how to get the best price but to create the right process and to make it stick. And since I came through that process myself, I highly recommend to anybody who doesn’t have a real estate license or the legal background to get someone to represent them. For example, a client in California we are representing was being chased by at least six different parties. The owner kept providing financial information but nobody came back with a firm offer. So, he had all of his confidential information spread out among all these different parties. But for whatever reason the business owner was struggling to get them to the table to give him an offer that he would be willing to accept. As investment bankers, we are able to control that whole process, to say you only pass go if you come through us. The information comes to us, is sourced through us, and you just don’t get to talk to our client until we say so, that’s all there is to it. What impressed you enough about FOCUS to make you want to join as a senior advisor after you sold your company? If you use FOCUS you don’t have to worry about anything. That instills trust in the client. One thing we do is we make sure the deal is done right and has the seal of approval on it. That’s what’s good about FOCUS. When the sale is done, it’s real. If you do it on your own and something goes wrong after the close, that’s on you. We’re able to give the client a range of what we feel they’re going to wind up getting. We have a conservative approach; we give them a range and have been successful in keeping them at the upper level of that range. That builds trust. Once we have trust with the client, both pre-close and post-close, then you have people willing to sell through you. The FOCUS team isn’t just one person. We have a lot of resources and experience based on all the deals we have done. If I feel I can’t answer something I just call another member of our team. The resources are there. We make the initial data request. That really helps flush out any kind of potential issues. The questionnaire we have designed really helps get rid of those issues. It also makes the client aware that there’s something that could come back later. So, they know that if there is something wrong, they have to address it early on. We offer full transparency to our clients. If we have to say something that may offend the client, we say it. This will help avoid friction later in the transaction. Market Positioning and Competitive Landscape: How do you assess the market positioning of companies in the automotive aftermarket/collision industry during an M&A process? What considerations are crucial for evaluating the competitive landscape? We mostly represent the seller’s side. Our buyer pool has significantly expanded. There are about seven national groups, lots of regional groups and at least 20 private equity groups looking to enter the automotive aftermarket space, just in the past few years. That’s creating higher sales prices. But the problem now is the inventory of businesses for sale is thin. For a number of our buyers, the seller has to be of a specific profitability level for us to be able to get outside interest. The business has to be generating at least $2 million in EBITDA, but for a lot of companies that’s out of their reach. Industry Expertise and Insights: Can you share your perspective on the current trends and challenges in the automotive aftermarket and collision industry? How are these factors influencing M&A activities in the middle market within this sector? The industry now is becoming completely specialized, but the opportunities are greater than they’ve ever been. If you want to buy, sell or participate in the industry, there are a lot of opportunities, whether it’s ADAS (Advanced Driver Assistance Systems), electric vehicles, hybrids, or new materials. There are so many segments that you can get into right now. Even for a technician who wants to become a business owner. Years ago it was all body work. Then it was body and mechanical. Then it was body, mechanical and aluminum. Then high-end electronics. It’s getting more and more complex. Shops with scale can invest in all specialties, but in my opinion, for smaller shops to be successful, they will have to prioritize one or two segments of repair. You can’t go in all directions without scale. First of all, you have to buy special equipment. You also have to have special training. But it’s not just the initial investment—it’s the continued investment. Every year you have to get certifications and they’re not cheap. New tools also come with a high price tag. Most shops have not made the investment in this because they can’t afford it. The bigger shops can. I think the consolidators will eventually become an enterprise. The big guys will go on. So if you’re a small shop and don’t have the resources to remain competitive, it may be time to think about selling. Deal Experience and Success Stories: Could you highlight a few M&A transactions in the automotive aftermarket and collision industry that you’ve been involved in? What were the key challenges faced, and how did your strategic approach contribute to the success of those deals? You don’t have to mention names – descriptions of the deals are fine. We had a deal that took seven years to close, but it could have gone on forever. I wasn’t happy with the way the deal was being structured, and the owner was getting insufficient offers that I thought would not realize the true value of his company. Then finally, when I was with FOCUS, the timing was right for him. The demand market was improving, with additional buyers and an influx of private equity interest. Then we got two consolidators to bid on it—that’s what really made it work. That’s where (FOCUS Managing Director) Nancy Rolland came in. She’s very good at picking out which buyer we should go with. That makes it much easier. Five or six years earlier we probably couldn’t have gotten him more than $1.8 million for one of his locations, and $2.5 million for both. Instead, we wound up making a deal that was worth more than $8 million. I felt he deserved that and I was really proud of the fact that by working as a team we were able to get that for him. How do you and business owners stay on top of industry developments? Go to your quarterly collision industry conferences. Stay with your trusted network. Build a “20 Group.” If you don’t have one, find one or build one, but get into one. A 20 group is a group of like-minded people who share ideas, who don’t care about crossing borders. I’ve been part of a 20 group since the early 1990s and we are still friends. I still talk to them on a monthly basis and we do things together. Additionally, there are industry periodicals and podcasts like what our colleague Cole Strandberg is doing. He is really doing a great job, very impressive. If you are interested in learning more about the Senior Advisor role at FOCUS, please contact Kahla Cooper at [email protected].

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