Your Helpful Guide
Buying a business or acquiring a company is commonly referred to as Business Acquisition. Some might call it Mergers and Acquisitions (abbreviated to M&A). Business acquisition can be described as the process of acquiring a company to benefit the purchasing company (or individual or group). A merger is when both companies join to create one stronger or more profitable business.
Business Acquisition can also be called a buy and build strategy.
The buyer will be looking to either add value to their existing business by acquiring another; reducing running costs, access to skills or resources and to increase profitability.
The buy and build strategy is not without risk, as you would expect when buying any business. There are some key factors that will influence the outcome and ultimate success of the acquisition:
- Buying at the best price
- Due diligence
- Impact of the outgoing seller
- Choosing the right advisor
The last point, choosing the right advisor is crucial. As a business owner you shouldn’t represent yourself in such a significant and potentially life-changing deal. A professional team will lead you through the process and guide you to the close of the deal.
The professionals that help you need to be experienced and dispassionate, looking at the facts and leaving emotion at the door. The approach to the initial search for a business, if an acquisition has not already been identified, should be exactly matched to the requirements, finance available and ultimate goals.
The typical steps to business acquisition are as follows:
- Research sector
- Research and identify target acquisition
- View and get to know the business
- Valuation of the business
- Raising or arranging the finance
- Formal offer of acquisition
- Deal negotiations and execution
- Due diligence
- Complete the purchase
- Communicating the deal to employees
Every step of the way is fraught with potential issues and pitfalls and it’s imperative you have the necessary business acquisition team behind you to get the deal through successfully. As soon as you are ready to seriously think about mergers and acquisitions, get in touch with an experienced and friendly group of experts that will advise and guide you in an impartial way.
If you would like to have a no obligation chat with our specialist business acquisition team, contact us today!