Small Business Mergers & Acquisitions

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M&A Management Meeting: How to Make the Seller’s Presentation Shine

The greater the number of people who attend a meeting, the greater the odds someone hasn’t actually read the M&A offering document. At the beginning of a management meeting, ask, “Okay, so who has read [more…]

What is an M&A Letter of Intent?

A letter of intent (LOI) is basically an M&A form of a marriage proposal from Buyer. As the name implies, the LOI lays out the intent of both parties: Seller states she is willing to sell for the proposed [more…]

M&A Letter of Intent: Valuation and Deal Structure

Valuation is the key number everyone looks for in an M&A deal. Usually the valuation appears in the third or fourth paragraph of the LOI (letter of intent). [more…]

A Few Terms to Include in an M&A Letter of Intent

Although no one-size-fits-all approach applies to writing an M&A letter of intent (LOI), the basics include some boilerplate legalese and some detail about the specific deal at hand. [more…]

M&A Letter of Intent: Financing Contingency

Most letters of intent (LOI) contain some info about where Buyer proposes to obtain the dough needed to effect the M&A transaction. Sellers should pay very careful attention to this part of the LOI. The [more…]

Terms and Conditions in an M&A Letter of Intent

The letter of intent (LOI) lays the foundation for the M&A deal as it moves forward. Here are some of the sections you should make sure you include in a LOI as part of any deal: [more…]

M&A Negotiation Key to Success: Know Your Position

M&A deal-making is a lot like playing poker. For example, knowing whether you have a weak or strong hand is important because your hand’s strength helps dictate how you negotiate the deal. [more…]

M&A Negotiation Key to Success: Remember the Goal

Buying or selling a business can be a messy affair. M&A insiders call it “making sausage” because it’s an ugly process with a tasty end result. (Well, assuming you’re not a vegetarian. In that case, think [more…]

M&A Negotiation Key to Success: Negotiate with the Decision-Maker

The biggest, most important, and most basic M&A negotiating rule is to make sure you negotiate with the actual decision-maker and not an influencer. Of course, speaking with an influencer isn’t automatically [more…]

Keys to M&A Negotiation Success

Negotiating doesn’t only happen during a tidily defined portion of the M&A process. Negotiations occur throughout the entire process, and M&A deal-makers should constantly remember that reality. [more…]

How to Use Successful M&A Negotiation Tactics

Negotiating an M&A deal is not about forcing your will on the other side. That’s called unconditional surrender. If the other side has other options, they’re not going to agree to your stringent and unbending [more…]

When to Phone and When to E-Mail during M&A Negotiations

As an aid to successfully negotiating an M&A deal, pick up the phone and have a conversation, especially if the subject is delicate. The flip side to “pick up the phone” is “avoid e-mail.” E-mail is a [more…]

Successful M&A Negotiation Tactics

Certain tactics can be helpful in the process of negotiating a successful M&A deal. Remember: Negotiating isn’t about getting everything you want, but about finding a deal that is agreeable for both sides [more…]

M&A Negotiation Tactics: Beware of a Bad Bluff

Bluffing may be a bit Machiavellian, but it can be a useful M&A negotiation tool. M&A negotiating often involves much of the same kind of bluffing (and knowing when the other side is bluffing) as is found [more…]

How to Avoid Common M&A Negotiation Mistakes

The number one M&A negotiating tactic to steer clear of is bullying. For some crazy reason, negotiating novices tend to think negotiating is about imposing their will on the other side with a take-no-prisoners [more…]

How to Get an M&A Deal Back on Track

Here’s a key point for anyone who wants to get into M&A deal-making: The process isn’t linear. Expect the unexpected. The plan is important, even imperative, but you can’t become a slave to it. As long [more…]

How to Negotiate an M&A Deal in Good Faith

Negotiating in good faith is a term that you may hear bandied about during the M&A process. Negotiating in good faith is a code of honor. It means you follow through on what you say you’ll do, and that [more…]

M&A Closing: Distribution of Funds

After all the necessary agreements have been signed at an M&A closing, Buyer funds the deal by obtaining money from his sources and distributing that money to Seller and any other party that appears on [more…]

M&A Closing: Review the Flow of Funds Statement

The flow of funds statement at an M&A closing is a very detailed list of the sources and uses of money — where the money comes from and where it goes. It’s typically created in the days right before the [more…]

M&A Letter of Intent Sections

Although many things in the M&A world — an indication of interest, a term sheet, a phone call where Buyer says, “We’re interested and we’re willing to pay [more…]

How to Agree to M&A Exclusivity

Buyers often prefer to negotiate M&A deals without the nuisance of competition. Strike that; Buyers always prefer to negotiate deals without the nuisance of competition. Who can blame them? Removing competition [more…]

The M&A Due Diligence Process

The goal of due diligence in the M&A process is for Buyer to confirm Seller’s financials, contracts, customers, and all other pertinent information. In other words, the goal is to make Buyer comfortable [more…]

How to Time the Due Diligence Phase in an M&A Deal

In theory, due diligence in the M&A process should take no longer than 60 days. When buying or selling a business, you want to close a deal as soon as possible. You should not submit or agree to a letter [more…]

How to Run the Company during M&A Due Diligence

Seller should continue to run the business as if she weren’t in the middle of an M&A deal. The company should buy supplies, pay bills, and make sales calls as before. [more…]

How to Convey Due Diligence Information to the Buyer in an M&A Deal

In days of yore, back when the slide rule and rotary-dial phone ruled, M&A deal-makers conducting due diligence would sit in a room, informally called a data room, with a stack of financial statements, [more…]

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