Creating an Exit Strategy and Realizing Strategic Value
In selling a business, planning and process are the keys to success.
The sale of a business begins well in advance of the actual event, often as much as one to three years before. Two of your first decisions will be deciding who will be the Team Leader. Then you have to select and engage advisors-law and accounting firms, and possibly an investment banker/financial advisor. Inside the company, key senior managers will need to be taken into your confidence. It may be necessary to incent them to remain with the business in the event of a change of control. Finally, it is important to "dress up" the business for sale and there are a number of factors that go into that process.
When you are prepared to go to market, the next important decision is whether your business would be most attractive to a financial or strategic buyer. The process of developing interested buyers and negotiating the purchase and sale agreement combines both art and science so professionals who have experienced the process many times can anticipate the potholes of negotiations and enable you to remain in control. At the same time, your team leader should keep you out of the fray so that the negotiators have to come back to you on the really tough issues because they "need to check with the boss/CEO/Board" on all key questions such as terms and conditions and representations and warranties.
The sale of a business begins well in advance of the actual event, often as much as one to three years before. Two of your first decisions will be deciding who will be the Team Leader. Then you have to select and engage advisors-law and accounting firms, and possibly an investment banker/financial advisor. Inside the company, key senior managers will need to be taken into your confidence. It may be necessary to incent them to remain with the business in the event of a change of control. Finally, it is important to "dress up" the business for sale and there are a number of factors that go into that process.
When you are prepared to go to market, the next important decision is whether your business would be most attractive to a financial or strategic buyer. The process of developing interested buyers and negotiating the purchase and sale agreement combines both art and science so professionals who have experienced the process many times can anticipate the potholes of negotiations and enable you to remain in control. At the same time, your team leader should keep you out of the fray so that the negotiators have to come back to you on the really tough issues because they "need to check with the boss/CEO/Board" on all key questions such as terms and conditions and representations and warranties.