Key actions in the sale process
|Key Actions||Principal Activities|
|Briefing||Understanding our client’s personal and financial objectives from the future sale of their business through the completion of a comprehensive briefing document|
|Research||Researching and compiling a list of potential buyers who will have the rationale and financial capability to acquire our client|
|Buyer Approach||Preparation of a scripted anonymous summary on the business. Contacting the identified decision maker of each potential buyer on an individual basis both by telephone and email to outline the benefits that their business may achieve by undertaking this acquisition|
|Marketing||Marketing the business through an Information Memorandum. Initial discussions with potential buyers, securing and assessing indicative offers|
|Negotiating offers||Inviting the most attractive offers to individual presentations. Further negotiations with potential buyers and negotiating the very best value for our clients|
|Completion||Agreeing exclusivity with one bidder. Drafting the Heads of Terms. Managing the other professionals (lawyers, providers of finance, accountants and tax advisers) involved in the sale process from Heads of Terms through the Sale and Purchase Agreement to the completion of the sale of the business|
Most trading businesses sold are valued on multiples of profitability or revenue with any goodwill, typically anything above the value of the net assets, inherent within the multiple applied. At DCA Corporate we focus upon the competitive advantages and the benefits that our client will provide to the purchaser.
We also look at underlying earnings, future profitability and a post sale strategy, ensuring that the purchaser identifies and values the upside and this is reflected in the price they pay for the business.
How long does a sale process take?
The best result requires care and attention; rushing a sale may well result in a substantial loss in sale value. The diagram below shows what, in our view, is the time frame from inception through to completion.
Although every business is unique, DCA Corporate can, assuming that the flow of information between the client and us is free from complications and delays, secure Heads of Agreement (deal in principle between the seller and the buyer) within 8 months. The legal process, from Heads of Terms through to completion, including accounting, legal and commercial due diligence, can take another 3 to 4 months.
DCA Corporate is there to orchestrate the whole process to ensure that the deal gets done.