15 Jan Know The Potential Acquirer
The first step in planning to sell your business, is to list the potential acquirer. Positioning a company to be attractive to the best buyers is an important strategy to maximize value and obtain a premium valuation over normal industry standards.
In the planning process the following questions need to be investigated:
1) Who owns a similar company and has expansion objectives?
2) Which companies in my industry have surplus cash?
3) Which companies are similar to mine but in different geography?
4) Which companies have a vested interest in horizontally or vertically integrating into my market space?
5) Which companies in my industry have announced a public listing?
6) Are there any investor backed “roll up” strategies occurring in my industry or related ones?
7) Which companies have a vested interest into diversifying in my space?
8) Which companies have recently announced a consolidation program?
9) Which companies in my industry have undertaken acquisitions?
10) Which companies have recently sold off part of their business?
11) Which companies may want to access my customer base, technology, operational methods, IP or employee skill set?
How do you go about in getting to know the answers to these questions? Simple, you need to do some research, by:
1) Subscribing to industry news
2) Attain a leadership role with your industry’s association
3) Attend your industry’s trade shows
4) Join industry linked in groups and monitor activity
5) Talk to your employees, trusted advisors and others within your network
6) Start to engage an investment banker or business broker
Investing in the time to understand who the potential acquirer might be, will give you an indication of the best time to sell your business and the strategy to be implemented so as to attract a premium valuation.