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Selling a Business?
Are you considering selling your business? If so, as you are aware, there are many important
questions and considerations that need review. The decision to sell your business is one of the
most crucial, complex and emotional decisions you will probably ever make. The principals of
Arjuna having bought and sold companies for their own account are sensitive to this decision
and the process that unfolds once you have seriously decided to explore the sale of your business.
Having "been there, done that", you will find an empathetic and reassuring attitude from
Arjuna's professionals. They view each sell engagement as though they were selling their first company.
Arjuna Ventures offers the following thoughts relative to contemplating the sale of your business:
- Internalize your decision to sell
- Why do I want to sell?
- What will I do once I have sold my company?
- Do I have a price in mind at which I would be willing to sell?
- How will my family and customers react to the sale of my company?
- How do I feel about someone else running my business and sitting in my chair?
- What impact will new ownership have on my employees?
- How can I structure a deal that not only meets my requirements, but also treats my employees in a fair manner?
- Am I willing to offer a loan to the new owner?
- Ultimately, what kind of buyer do I see being the right fit to assume ownership?
- Should I try to sell on my own or engage a professional?
- Should I engage a M&A professional?
- If I try to sell on my own what professional services and networking might I be lacking?
- How do I maintain secrecy so my customers and employees are unaware of my intentions?
- How much time and patience do I have available to thoroughly market my company?
- How much will my business suffer while I am focussing on selling the company?
- Will I be dealing from a position of strength without an intermediary?
- How can I obtain an accurate valuation of my business?
- Even though many people can value my business, do they have the infrastructure to find buyers?
- Where do I find qualified buyers?
- How do I create a competitive bidding environment?
- How do I determine what offers are for real?
- Do I want my competitors dealing directly with me?
- How do I know what a fair price is relative to market conditions?
- How much time is required to manage the various advisors during due diligence?
- Consider the old adage, "an attorney who represents himself, has a fool for a client"
- Engage a professional
- Do I personally know any competent M&A professionals?
- Do any of my advisors have direct working experience with an M&A firm?
- Have any of my associates used an intermediary whom they would recommend?
- Should I check the professional associations such as IBBA, M&A Source, MBBI, etc. for a listing of qualified M&A professionals?
- After talking with three professionals, have I found a firm I believe can best represent my interests with integrity and in a quality manner. Do they accept ownership of my vision and expectations?
- Are they a full service firm? i.e. can they provide and orchestrate all the professional services needed to complete the transaction?
- Do I have faith that they can successfully serve my interests above their own?
- Does my M&A firm utilize interactive web sites such as BizQuest, M&A Source, etc. to promote my business nationwide?
- How well established are they and do I feel comfortable with their ability to obtain buyers for my company at a fair price?
- Follow your instincts, so far they have served you well in building a business suitable for sale.
- Work with your professional in an open, candid and forthright manner with full disclosure and cooperation
- What information can I provide my M&A professional so he has complete disclosure and a working knowledge of my business?
- Do I have the past 5 years' financial statements available?
- Am I open in providing information for an accurate recasting of my discretionary expenses?
- Do I have readily available information regarding my real estate and/or leases?
- Do I have readily available an accurate accounting of my inventory?
- Have I identified my major customers, especially those having long term commitments?
- Have I identified my major competitors and how we succeed when encountering them?
- Does my M&A professional understand my assessment of future growth for my company?
- Have I authorized open access to my advisors, especially legal and accounting?
- Have I shared my involvement and membership in relevant industry trade associations?
- Do I know of any potential buyers and/or consolidators in the industry that I have not shared with my intermediary?
- Have I made provisions for the interim financial statements required during the due diligence phase?
- Do I feel comfortable with the direction and advice I have been given thus far?
- Do I have answers for all of the questions I have on my mind?
- While your professional is marketing your business, pay attention to details and maintain objectivity
- Am I focussing on the day to day operations to ensure my company stays on track?
- Have I made arrangements to engage an attorney specializing in transaction law for the due diligence and documentation aspects of the transaction?
- Have I engaged a professional for tax and estate planning?
- Is my intermediary updating me weekly with the status of the marketing campaign?
- Are there any significant changes in my business that I have not shared with my M&A professional?
- Are my expectations for this transaction realistic with current market conditions?
- Am I ready to review the offers with an open and pragmatic mind?
- Am I prepared for the "emotional roller coasters" and patience required during the upcoming negotiations?
- What happens if I do not receive an acceptable offer?
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