The business sale process has a number of distinct stages and typically takes 6 to 10 months to complete.
There are strategic and financial options. The right buyer is the one that benefits the most from the purchase.
Before proceeding down the M&A path, here you can familiarize yourself with the terminology and typical documentation used in the process.
Here we present common Mergers & Acquisitions (M&A) acronyms, abbreviations and definitions used in the M&A process. One of the first documents used in the M&A process is a one to thee page no-names summary description of the opportunity typically called a teaser. If the teaser is of interest then parties will sign an NDA or…
How do you select the best possible buyer for your business? Simply put, companies with an ability to pay and an interest in paying a premium. Assessing the ability to pay for private companies is not as straightforward as it is for public companies, which have to disclose their financial information to their shareholders (by way of EDGAR in the…
Winners remorse: does paying more for a business than anyone else mean you have overpaid? Not necessarily…
What will a strategic buyer pay? Ideally a premium, but what defines a premium? By definition, it is higher than the average price. But if the market will ultimately determine the price, where do you start? Start with the notional value A notional value determination is one in absence of an open market transaction, in…
Five Examples of acquirers paying a premium. What are buyers looking for in acquisition targets? The objective of an acquisition is to create value. This is accomplished by improving profitability and/or reducing risk; both enhance earnings quality and drive value. More specifically, acquisition objectives can include achieving economies of scale or economies of scope, vertical…
How does an M&A advisor add value to the sale process? There are many non-price issues that arise during an M&A process. An M&A advisor can keep the process running smoothly and ensure the post sale relationships are started on the right foot. The following are three areas where an advisor improves the chances of…
Non Disclosure Agreements (NDAs, also called CAs for Confidentiality Agreements) are contracts that stipulate that information received from a counterparty will only to be used for the purpose as defined in the NDA and that it will not be used as a basis for competitive tactics or shared freely with others…
What is a financial buyer and what logic drives their approach to price and structure?…
How to Choose a Business Broker? In the process of choosing an M&A advisor to manage the sale of your business, you will undoubtedly have a discussion about valuation and price expectations. During such discussions, some advisors will lead you to believe they will secure a higher price than others. How much should you weigh…
When assembling a thorough buyer list, it does not necessarily need to include immediate competitors. Sellers will know the reputation of these companies in the marketplace and may not want their legacy in such a company’s hands…
