It goes without saying that different businesses have different goals for the future. The goal might be to exit from a business, enter new markets by the acquisition of a business, or it could be something else entirely. There are many ways for a business to achieve its desired future state, but regardless of what the goal is, chances are that at some stage in the journey an acquisition or business sale transaction could be a viable option.
No business is too small or too large to realise the benefits of a successfully executed transaction. The secret lies in knowing how to effectively bring together two companies in today’s constantly evolving marketplace.
Knowing whether a transaction is right for your business
On the surface, a business sale or acquisition transaction can sound relatively straight forward but the reality is normally very different. Sure, some transactions are relatively straight forward to execute with the right advice. On the other hand, others can involve incredibly complex arrangements. In fact, research regularly highlights that one half to two thirds of transactions typically fail to achieve their objective.
Regardless of how complex a transaction your business may face – now or in the future - there are some fundamental principles that can guide your management team and its advisers from start to finish.
Your eight step blueprint
By following eight logical steps, your leaders can ensure the key issues that matter to your business remain top of mind throughout the entire transaction process – regardless of which side of the deal you are on (click the image to download a cheat sheet for your reference).
Failure to consider each of these steps could result in additional time/financial costs to bring the transaction to fruition, unfavourable deal terms, or even termination of the deal with hefty penalties.
Executing the blueprint
Putting the blueprint into action requires dedication, trust and thorough planning, but the rewards are well worth it.
BDO used this approach when Phillip Di Bella, founder of Di Bella Coffee - one of Australia’s largest specialty coffee companies – was looking to sell his business. By remaining focused and following the eight step blueprint, BDO guided Di Bella Coffee’s management team through a $47 million sale to Retail Food Group in just 13 weeks.
Considering a transaction in isolation of a business’s growth or exit plans is fraught with danger.
If you’ve been involved in a transaction, or your business is considering one, I welcome your comments about the issues you faced and what helped you and your leadership team through the process. To find out more about how you can get the best possible outcome from your business sale or acquisition activity, please connect with me.