Home Features Mastermind Videos About Advertise Blog Network Contact
   

Have A Suggestion?
Toronto Salsa Classes / Toronto Salsa Lessons Email us your ideas on how to make our website more valuable! Thank you Sharon from Toronto Salsa Lessons / Classes for your suggestions to make the newsletter look like the website and profile younger entrepreneurs like Jennifer Lopez and Sean Combs!
Have A Suggestion?

Featured Ebook


ebook Famous Entrepreneurs - Modern Empire Builders


Featured Ebook

More Evan Carmichael
Have A Suggestion?

Sales Lessons From Starbucks And Dell

Mergers and Acquisitions - a sellers’ guide for SMEs



Mergers and Acquisitions - a sellers’ guide for SMEs
   

It could well be that a trade sale or MBI would be the best option as it would give you a fair price while protecting the employees by ensuring they remain in jobs in a business that will continue to be run well. Also, if you receive the price you want, you could share some of your gain with the key staff who helped you to build the company. By the way, preparing in advance to share your gain through, for example, the creation of a share option scheme would be a sensible move to make.

The other key factor to consider is what you want to do post-sale. If you want or are happy to stay in the business after it is sold, you will have a greater range of options available to you. In some cases, such as a floatation, you will almost certainly be required to stay for a period of time. If the deal does involve you in staying with the business for a while, you will probably be required to accept an earn-out, where part of the sale consideration is held back and paid to you over time against the achievement of agreed targets and milestones. Earn outs can be risky and are a whole topic in their own right – just be careful not accept too much commitment.

Finding a buyer If your chosen method is floatation, you will need to employ the professionals who will plan and organise the process for you – you have no choice. In this case, the buyer is all those people and institutional investors who believe in your company and want to buy a part of it.

In all other examples mentioned above, finding a buyer is about knowing where to look. For the MBO, it is easy, it is your current staff. In the case of a trade sale or MBI, the buyer is often known to you in the business community where you operate. In fact, they may approach you, rather than you having to look for them. The disadvantage with this apparent convenient and comfortable situation is that you are looking at a very limited list of options and as a result may not be getting the best deal. My advice would be to employ a professional M&A company who know your sector and who will be able to offer you a range of buyers. By creating a competitive situation, you will ensure you get the best price and overall deal.

In Summary:

* Many of the sell and buy issues will be mirror images of one another, so it may be worth reviewing last month’s buyers’ guide.

* A decision to sell should not be a knee jerk reaction to a tactical matter – if it is you will probably get only a fraction of the real value of the business.

* The essence of any deal is the word “fair”. There cannot be a deal without a willing seller and a willing buyer.

* They will want to do due diligence – make sure your business is clean and ready for this.

* Know what you want from the deal; money, shares, a job, to leave immediately after the sale, and ensure you get what you want.

* Following on from the previous point, think carefully about accepting any earn out.

Copyright © Performative plc 2001-2006. All rights reserved.



Mergers and Acquisitions - a sellers’ guide for SMEs - To learn more about this author, visit Phil Shipperlee's Website.

Like this article? Share it with your friends
[Get Copyright Permissions] E-Mail | Print | More  


Related Articles Related Articles
Go and Get it
  Business is out there. It’s up to you to go get it. Mergers and acquisitions are on the rise. Many CEOs have been putting their cash away for the past few years and are ready to take advantage of the steady economy ...
Restricted Access to Finance
  Africa’s SMEs have little access to finance, which thus hampers their emergence and eventual growth. Their main sources of capital are their retained earnings and informal savings and loan associations (tontines)...
5.2.1 The MIT-SME section: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
  Prior to 1997, the small business development function rested within a Unit whose status was equivalent to that of a department and reported to a deputy minister.
What can business and governments do to promote SMEs?
  Poverty remains a major challenge to sustainable development, environmental security, global stability and a truly global market. The key to poverty alleviation is economic growth that is inclusive and reaches the m...
Facts about SMEs in Africa
  Very few countries have working definitions of SMEs, except some members of UEMOA/WAEMU and Mauritius and Morocco. So data on this is hard to compare, though patterns can be seen and countries can be ranked by exte...

Related Forum Posts Related Forum Posts
Definitions of merger Definitions of merger
Ebay Appeal to Small Business Ebay Appeal to Small Business
Re: In-House or Outsource? Re: In-House or Outsource?
My Site Would Love It My Site Would Love It
Just Want To Say... Just Want To Say...
Way To Go! Way To Go!
eBay Shipping Rates eBay Shipping Rates
Creating Value Creating Value

 
About the Author


Phil Shipperlee
(Visit Phil's Website)
Phil Shipperlee, CEO and Founder of Performative, started in sales with Olivetti in 1969 and progressed to senior roles in Sales & Marketing in the Software & IT Services sector; UK country manager, head of global sales & marketing based in the USA, head of European operations (UK, France, Benelux, Germany and Italy). Phil was instrumental in creating a selling process integrating 12 acquisitions and used throughout operations in North America, UK, Europe, Australia, Japan and India. Since 1980 he has built and run several successful businesses. Performative provide business performance improvement solutions to companies across the UK. There is an indisputable link between the overall performance of the whole business and the performance of the sales operation, hence, our core focus commences in the sales operation but also looks upward to the Board and its strategy, and outward at the integration of the selling operation with the rest of the organisation. Special areas of knowledge: the creation of high performance selling operations within any corporate environment, solving the business issues of SMEs, using and selling offshore solutions, M&A, post-acquisition integration.
Have A Suggestion?

View Author's Blog
Become An Author

View Author's Video
Become An Author

Free Downloads


Phil Shipperlee's

Complete
List Of
Sales
Articles

First Name
Last Name
Email
 
If you enjoyed this article, get Phil Shipperlee's Complete List of Sales Articles For FREE!
Become An Author