All interested parties are required to complete a non-disclosure agreement before any information is shared. Employees can become prematurely worried. Customers may grow concerned. Competitors who aren’t pursuing an acquisition may use the information to enhance their market position. That is why confidentiality is a cornerstone of our operation.
We invest a lot of energy to research, and develop a specific marketing plan for each engagement. We actively develop interest by confidentially contacting buyers who may view the company as a good acquisition. Targets include strategic buyers, private equity investors, well-funded individuals and others. We do not wait passively for interest, but contact them directly to generate interest. Our goal is to develop a competitive environment so the owner receives the best possible value.
We review the company to find opportunities for enhancement. This generally involves an owner who is not quite ready to sell, but would like to take that step some time in the future. The valuation process provides today’s value range, and the process of comparing to certain industry metrics can suggest enhancements. A review of operations may find areas for adjustment. A pre-diligence review can identify details that will be needed for a sale to be completed.
After an LOI is signed, the buyer will begin a detailed review of finances, operations, legal structure and more. It can be a daunting process, with many questions raised and new information needed. We begin early gathering of information we have found most buyers want, and then supplement this list with specific requests. When the time comes, we serve as a conduit for information so the owner can stay focused on the business.
It is best to consider before you have to, and while you can see a sale through. Often deals come with contingencies that may require your attention post sale, so waiting too long might cut into what you have in mind for life after the sale. Efforts to pick the peak time rarely yield the desired outcome. There are many issues to consider, both business and personal. However, it is better to be dealing with these while you have options.
We work with the seller to prepare for a sale, develop materials that tell the story of the company and then proactively seek buyers. These range from strategic groups looking for expansion to private equity buyers seeking an investment. There are also highly qualified individual buyers seeking new opportunities and we have a number in our database, too. We quarterback the process, start to finish, and work with your other professional advisors to seek the best outcome.
Generally, we do not price the company. Rather, we ask buyers for proposals and then review these with owners. Because we are proactive in our buyer search, we ask for buyers to give their best proposals. That doesn’t mean anything goes. Rather, the process we use to focus interest is intended to provide owners options for a decision. There are times, however, when putting a price on the business is effective. We will use this when appropriate to accomplish the seller’s goals.
The methods and tactics outlined above result in the owner actually exiting at their time of choice. They also result in the highest value available in the market as different classes of acquirers are approached and a specific, targeted market is created for the single asset; the business being marketed.
BTS News
Manufacturer Sold and New Owner Expands It
BTS served as advisor in the sale of PlasTech Machining Fabrication, Inc. to DelCam Holdings in 2020...the company has grown substantially, doubling employment and adding capacity to boost future prod
How M&A Will Respond to Next Recession
The takeaway for business owners: Get back to basics. Don’t worry about hyper growth. De-risk your company as much as possible.
Perception vs Reality with Small Businesses
Sometimes the economic picture on the news seems inconsistent with what is happening for many business owners. Nearly every owner we speak to is out straight.
NH-Based Techinical Manufacturing Company Sold
Hampshire Controls has a bright future with new ownership. The company was recently sold by Diane Rush, owner and president, to Pillar Imaging and its leader Dr. Michael Pilon.
Be Ready When You Are Ready
When a business owner says it’s time to sell, I ask, “How fast do you want to be out?” The answer I hear most is, “Yesterday.” But sellers underestimate how long the process takes.
Looking at a Sale Through the Right Lens
Sometimes our vision about the future is blurry because we aren’t considering the whole picture but only parts of it.
5 Deal Points from the Trenches
Today I work with clients of Business Transition Strategies who are implementing Growth Through Acquisition strategies. Here are a few observations from working on a wide variety of projects.
Tax Changes Could Hurt Net Proceeds
Changes proposed to the capital gains tax suggest they may need to get 30% more in a transaction in the future just to net the same value they would get today.
Good Ideas From Shark Tank Deal
One of my colleagues in Cornerstone Alliance was front and center in a recent Shark Tank exercise. A business that had been sold was put in front of four potential buyer groups.
Buyer Trends in Lower Mid-Market
Other businesses are a significant market for companies being sold within the lower mid-market.
Case Studies
Precision Machining Company
Initially, liquidation was a serious consideration. It would offer a quick exit but would hurt loyal employees and disrupt the customers who had come to rely on its quality production.
Green Product Company
Our client owners could dig in for the long haul…However, this would take five years or more. Owners simply lacked the horsepower to do it.
Water Purification Company and Young Buyers
Owners decided they wanted to retire. They also wanted to be fair to the staff who had been loyal to them. Could the company be sold, the staff retained and the facility remain in use?
Magnetics Company with High Profile Customers
(T)he manufacturer would need to focus on growing EBITDA to capture interest from major strategic buyers and achieve a higher multiple of earnings.