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The first thing to recognise is that you can sell your company through one of two routes:

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Reactive or ProActive

 

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A Reactive route is where you advertise your business on a website and/or hope for ad hoc buyer enquiries.  However, you can expect that:

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• Enquirer controls timing & process

• Valuation likely to be uncompetitive

• Acquirer holds leverage and M&A expertise (or, worse, has little acquisition experience or finance)​​

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So without a competitive bidding environment or market comparison, the Reactive route is unlikely to result in an optimum outcome for the seller. And the risks in terms of lost time & value can be significant.

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A ProActive, route puts you in control:

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• Seller controls timing & process

• Competitive valuations & choice of acquirers

• Seller holds leverage & secures M&A expertise

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As the ProActive route consistently delivers the best deal outcomes as determined by individual sellers, this is pathway we recommend in most cases.

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If you wish to sell your business via the Reactive route, you can simply place an advert on a businesses-for-sale website (or not). Then sit back and wait for the enquiries, which may or may not be forthcoming.

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Selling Your Business ProActively

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The steps necessary to pursue a ProActive route, however, require more input, but at a high level should be:

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1. Plan & Prepare

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Before you sell your business, the clearer your goals, the more optimal your outcome will be. Also, ensure your management information is ready for the rigours of a due diligence process. A few key actions now can save you substantial time & difficulty later on.

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2. Research a list of potential acquirers

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This list should typically be between 80 & 150 fully profiled & qualified prospects.  Less than that and you will not get enough market coverage to make sure you have the best acquirers in the process. More than that could leave you overexposed in the market.

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3. Produce a ‘Teaser’ Letter & Confidential Information Memorandum, including Financial Tables

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Your Teaser Letter should be anonymised, sharing just enough high-level information to entice a potential acquirer to sign a Non-Disclosure Agreement. The Information Memorandum should describe the key facts of your business and demonstrate the earnings and forward business plan.

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4. Approach the acquirer market

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Directly contact the M&A decision makers in each organisation over a 2 to 4 week period.  Firstly, secure their confidentiality on a Non-Disclosure Agreement, only then should the identity & details of your business be disclosed by sharing the Information Memorandum.

 

5. Meet with interested acquirers and invite their offers in a competitive process

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Your management presentations should be value-enhancing and all take place in a controlled environment and timeframe, with clear & consistent offer deadlines and acquisition process set out.

 

6. Negotiate a Heads of Terms / Letter of Intent

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Sets out the price, structure and other terms of the transaction. Make sure to have a clear understanding of this before selling your company. Few clauses in this document will be binding on the parties, exclusivity being one of them.

 

7. Transact swiftly

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A thorough confirmatory due diligence process is usual before finalising the Sale & Purchase Agreement. It is critical to maintain the momentum of the both the transaction & trading throughout this final stage.

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Once you have completed all these steps then congratulations will be in order - you will have achieved maximum value in selling your business on the market!

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If you would like to learn more about Symmetry's fully managed services and how these can be tailored to your own business & goals, then we would be delighted to hear from you.

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