Focus SME Aggregation | A Growth Strategy for Italy’s Mid-Market.
In Italy’s mid-market, scaling up is increasingly a prerequisite to compete and invest. But what are the levers for growth when the market is consolidating? How can a company strengthen its positioning without giving up entrepreneurial control?
Aggregation can be an answer, but only if it is managed with full awareness. The editorial project Focus SME Aggregation | A Growth Strategy for Italy’s Mid-Market was created to explore these questions and provide a practical perspective on the main peer-to-peer aggregation strategies.
In this first contribution, Avv. Lorenzo Bacciardi – CEO of Bacciardi Partners – examines industrial mergers between competitors as a strengthening lever for family-owned SMEs.
Size as an Industrial Factor
In Italy’s mid-market, with enterprise values between €10 million and €150 million, size is no longer merely an organisational variable. It has become an industrial condition. Companies operating in this segment—especially family-owned SMEs—experience this every day, even when their financial performance remains solid and profitability stays strong.
In recent years, sector consolidation has clearly accelerated across mature segments of manufacturing, B2B services, and distribution. SMEs below €30–40 million in revenues struggle to sustain long-term investments in technology, internationalisation, and organisational development. Capital markets and the banking system, instead, reward larger and better-governed platforms. Valuation multiples confirm it: consolidated groups are valued at 8–10x EBITDA, while stand-alone players often remain around 5–6x. The difference does not reflect the quality of the business, but rather its critical mass, its ability to innovate, and its capacity to capture technology trends by applying them to both products and market-demand management.
In this context, many family-owned SMEs do not face difficulties due to strategic mistakes, but because they remain isolated while the competitive landscape evolves. Customers become larger, requirements increase, and bargaining power shifts toward those with scale and structure.
Merging Between Equals as an SME Aggregation Lever
In this scenario, a merger of equals takes on a meaning different from the traditional one. It is not an exit transaction. It is not a defensive move. It is a clear industrial choice: peer-to-peer aggregation among SMEs.
Two competing companies with revenues between €20 and €50 million, similar EBITDA margins, and strong territorial positioning can aggregate into a shared holding company, owned by the founding families. This structure allows them to overcome size limits, strengthen bargaining power with banks and customers, and build a credible platform for subsequent build-up acquisitions.
Entrepreneurial control is not diluted—it is reinforced. Growth through aggregation enables investments that were previously difficult to sustain and creates a stronger competitive positioning. These transactions work, however, only if governance is designed with discipline. Roles, delegated powers, and decision-making processes must be clearly defined. The holding company becomes the centre of the industrial vision, not merely a legal vehicle.
Timing, Finance, and the Governance of Consolidation
Consolidation is not only about numbers. It is also about coherence and timing. Successful transactions are built on a financial structure aligned with the industrial objective: family capital at the core, moderate leverage around 2–3x EBITDA, and dedicated revolving facilities to support an M&A growth path. Finance must support development, not turn into a constraint. Banking covenants must also be designed with this logic in mind.
Time is now a decisive factor. The €10–150 million enterprise value segment is among the most active for SME M&A transactions in Italy and Southern Europe. Generational transitions accelerate decision-making. Those who structure early build stronger platforms. Those who postpone risk being shaped by consolidation rather than leading it.
Want to Learn More?
If you operate in a sector undergoing consolidation, if your direct competitors are family-owned SMEs of comparable size, and if pressure on investments and margins is rising, the issue is not whether consolidation will happen—it is who will govern it.
Our work is to support entrepreneurs in designing growth strategies and solutions, identifying investors or partners, and structuring extraordinary peer-to-peer aggregation transactions that are industrially sustainable. Contact us to arrange a no-obligation meeting.
Avv. Lorenzo Bacciardi – CEO, Bacciardi Partners
In the Next Releases We Will Cover
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From Dependency to Control: vertical integration as an industrial strategy in the mid-market
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Peer-to-Peer Aggregation for Specialisation and R&D: technology-driven M&A in Italy’s mid-market
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Cross-Regional Peer M&A: from local champions to national platforms
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M&A and SMEs: you are never “ready”—the real work starts before the transaction