We are regularly approached by entrepreneurs who are already in advanced negotiations with a potential buyer for the sale of their company. These entrepreneurs come to us with the question whether the price offered is correct and whether we can guide the further process. Unfortunately for the process we often advise at that moment to take a step back and let us make a good (financial) analysis of the company.
Not only to assess the sales price, but also to properly guide the client through the rest of the sales process. This increases the chances of a successful closing with a glass of champagne at the notary.
Good preparation allows us to enter LOI negotiations with confidence and it promotes the continuation of the process.
Added value of preparation
By starting with a good financial analysis and carrying out a valuation, we delve into a company's value drivers and vulnerabilities. In addition to providing an indication of the possible sale proceeds, this provides the right information to enter negotiations well prepared.
Companies have more and more digital business information at their disposal. This gives us the opportunity to make an in-depth business analysis based on data. By properly presenting the financial figures and company information to the potential buyer, we ensure that the buyer is aware of the important elements involved in a company when making a bid.
Strong negotiating position
We see that potential buyers and their advisers are conducting increasingly in-depth bookkeeping research, partly due to the availability of data and company information. During the preparation phase, as M&A advisers within Van Oers Corporate Finance, we cooperate a lot with our Due Diligence colleagues, consisting of financial, tax and legal experts.
With the expertise of our colleagues, we put ourselves in the role of the buyer's advisers in the Due Diligence process. We ensure that the information is in order and correctly presented and later provided in the data room.
This preparation prevents negative surprises and it speeds up the Due Diligence process to keep the road to closing as short as possible.
Prevent negative final negotiations
After the Due Diligence phase, the final purchase agreement and other transaction documentation is drafted. If the findings in the Due Diligence deviate from the assumed information at the time of drawing up the LOI, the buyer will want to incorporate this in the acquisition conditions and purchase agreement.
A major deviation will give a buyer a negative aftertaste to the sales process and the glass of champagne at closing. We want to guard against this and so it is important to be well prepared at the beginning of the sales process.
