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M&A: Buy-Side Advisory

Buy-Side Due Diligence and Advisory

Our buy-side due diligence services consists of "traditional" accounting and financial analysis. Our team is staffed with professionals who understand business fundamentals. We not only analyze a target company's financial statements, but we understand the importance of communicating key deal issues that impact the purchase price and working capital needs post transaction. We provide a detailed "quality of earnings" analysis for the latest fiscal year and trailing twelve-month periods that provide insight into the company's operations and financial viability.

Our professionals have accounting, finance, investment banking and industry expertise, which allow us to analyze and communicate not only what has affected the company's historical financial statements, but also understand the company's future growth opportunities. We understand the impact that industry trends and a changing competitive landscape may have on your potential investment.

The advantages of growing through acquisition:

  • Acquisition of key personnel
  • Heightened industry recognition
  • Enhanced purchasing power
  • Increased customer base
  • Greater geographic reach
  • Increased financial clout
  • Expanded product lines
  • Reduction in overhead

Key Questions To Ask

  • Is your acquisition strategy affected by time restrictions and a limited set of target companies?
  • What is the size and nature of the competion for a prospective acquisition target?
  • Do you know that to successfully complete one strategic transaction it may be necessary to identify and screen 100 (or more) companies?
  • Do you have the time, skills and resources to make it happen?
  • Does the acquisition create shareholder value (before and after synergies)?
  • What are the realistic revenue and cost savings synergies that can be expected?

Our Process

  • Identify, qualify and investigate prospective sellers
  • Contact targeted sellers to determine level of interest
  • Identify several scenarios/options for buyer
  • Create relevant analytics that will maximize value
  • Work with management to create healthy communications with potential sellers
  • Optimize deal structure terms
  • Strictly enforce a confidential environment

Once A Candidate Is Selected

  • Structure and negotiation of the deal
  • Mediation of buyer/seller issues
  • Partner with legal and accounting professionals
  • Assist with financing, if necessary
  • Control every aspect of the deal from the psychology to the timing
  • Shepherd the deal from start to a successful close

Transaction Motivations

Each seller's dynamics is different; motivation to complete transactions include:

  • Change in Lifestyle
  • Portfolio Risk Reduction
  • Tax Benefits
  • Market Dynamics and Competitive Changes
  • Pressures dealing with External Issues
  • The need to Grow the Business with External Capital

Potential Pitfalls

Negotiation Issues that Affect Management:

  • Focus on the most important issues
  • Take your eye off of management, customers and operating aspects of the business
  • Moving too quickly to agree on details before major issues are resolved
  • Letting the control of negotiations slip to the seller
  • Become emotionally involved

Why Buyers Sometime Overpay:

  • Inadequate analysis and documentation
  • Market timing issues
  • Failure to identify true sellers and create an advantageous environment
  • Negotiating with only one potential seller