We don't just get multiple offers, we get
THE MAXIMUM PRICE
"No matter what it takes Michael gets it done!"
-- Spencer Brown
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"You were right on target....all the way through the process!"
-- J.W.
Frequently Asked Questions
1. What is your process?
2. What is my business worth?
3. Do you have industry experience?
4. What deals have you done?
5. How do you market confidentially?
6. Who are your competitors?
7. How long does the process take?
8. Should I tell my employees?
9. What should I tell my employees?
10. Why should I hire The Merger Expert as my mergers and acquisitions firm?
Our blueprint is designed at minimizing the sellers time, so that they can focus on running their business and having it grow, and getting multiple offers and THE MAXIMUM PRICE. To accomplish that, we have the seller fill out an extensive questionnaire regarding the company’s operations, sales, marketing, customers, suppliers, employees. We also collect due diligence materials such as financial statements, tax returns, A/R and A/P aging, et cetera. We then review this with them to gain additional insight into their operations and business practices. Just as each seller business situation if different, so are the company’s strengths and weaknesses. We uncover it all and tailor our marketing documents accordingly to highlight the core strengths of the offering.
With that done, we can now answer 99% of the questions that buyers may pose, thus minimizing interruptions to the seller. We prepare an Executive Overview (one page) to market to prospective buyers with a Non-Disclosure Agreement and a Business Review (30-50 pages). The Business Review goes into further details about the company and the buyer receives it after signing the Non-Disclosure and we have a conversation with them to qualify them further. Besides targeted mailing, internet site posting, we also call each, and every, buyer target. This is where our client state we are relentless. It takes between 2,500 and 4,000 calls to consummate a favorable transaction at THE MAXIMUM PRICE for the seller.
We find there are always general rules of thumb for each industry. However, we always exceed those. In general terms, very small firms sell for a small multiple of revenue, earnings, ebitda or assets. EBITDA is defined as earnings before interest, taxes, depreciation and amortization.
We put the extra effort to find a buyer who is looking to fill a “hole” in their organization that the seller fits. These “holes” may be products, services, regional presence, distribution channels, customers, higher profitability, or a business model in whole, et cetera.
• Do you have industry experience?
This actually is a double-edged sword to the seller and is frequently one of the wrong assumptions made by sellers. Over the past 25+ years we have dealt with many industry specialists who either represent specific buyers, or claim they have contacts in the industry. Here is what we have found:
Industry specialists are transaction driven. The faster they get a deal done, regardless of what the seller wants, the faster they get paid. When a buyer has employed an industry specialist/consultant to assist them in the deal, and we represented the seller, we have achieved twice the offered price from these “experts”.
Don’t confuse “industry specialist” experience with one’s ability to get a transaction done, THE MERGER EXPERT. What you should be looking for is a merger expert. One who focuses on what you want and can get you multiple offers and THE MAXIMUM PRICE!
We have completed transactions in a wide variety of industries. These include, but are not limited to: agriculture, construction, manufacturing, communications, wholesale, insurance, business services, healthcare and technology. For reasons of confidentiality, we do not list company names or sales prices. For further details, see Transactions.
We do not do commercial real estate, oil and gas properties, banks or financial institutions, turnarounds or distressed situations.
• How do you market confidentially?
We market utilizing the Executive Overview attached to a Non-Disclosure Agreement. In all of our documents we do not disclose a company or owner(s) names, or employee names or pay. The Executive Overview does not include the city or state of the company thus raising the confidential level. Our standard Confidentiality and Non-Disclosure agreement is worded to protect our clients for a period of three years regarding any information that is disseminated.
There are less than a handful of true merger and acquisition firms on the West Coast. By that, I am referring to companies whose sole focus is merger & acquisitions. There are firms whose expertise is consulting, e.g., general operations and/or sales and marketing. The sale of the business comes at the end of an assignment, and although they do not have the expertise required, they do not outsource this segment of consulting.
Our number one competitor is the seller. This person generally started the firm, worked 12-hour days calling on prospective customers, making or overseeing the production of a product or service, when in the office. In other words, they are the top salesperson. They know the company, its products or services, and its customers. What they do not know they figure they will learn. Unfortunately, what they do not know will also cost them in price and terms at the time they are trying to maximize both.
• How long does the process take?
Each transaction has its own timeline and this is actually hard thing to grasp. Clients, and company issues, have their own priorities outside of the transaction. The process from beginning to end can take from six months to one year. Typically, the process may flow as follows: 1) documents are gathered (financial statements, tax returns, other financial documents, corporate book, et cetera), reviewed by our firm; 2) marketing documents are created; 3) marketing commences; 4) conference calls and visits with multiple buyers occur; 5) offers are tendered; 6) prices raised; 7) due diligence occurs; 8) purchase documents are drafted by attorneys; 9) closing occurs.
We highly recommend you do not do this, as everything is completed confidentially with buyers who have signed the Non-Disclosure Agreement. Employees typically find out after a sale has occurred. As you know employees typically do not like change and the unknown. As it may take more than six months to complete a transaction with the “best fit” buyer you do not want to get the employees focusing on this and not on their work.
• What should I tell my employees?
We advise our clients who do tell their employees prior to completion of a deal, that you have been approached, and are now exploring other growth opportunities which a strategic buyer will bring to the company, such as new products, distribution channels, sales and marketing acumen, et cetera.
• Why should I hire The Merger Expert as my mergers and acquisition firm?
Preparation is a large part of the process. A seller is up against experienced buyers of companies and that is all they do. They probably have visited the seller’s competitors and suppliers, and may in fact be in discussions about acquiring their competitors as well. These are tough negotiating guys who eat sellers for breakfast and companies for lunch. The principal of The Merger Expert has 12 years experience buying companies, he knows how buyers think and negotiate. Having our firm on your team tilts the playing field to your advantage where it belongs.
Over 25 years of Relentless Focused Action Resulting in
“Achieving THE MAXIMUM PRICE for Sellers”