In order to achieve the maximum sale price and best terms when selling a company, it is critical for the vendor to thoroughly prepare for the sale. The best way to do this is ...
... to take the buyers perspective and conduct a due diligence and SWOT analysis on your own company. This will allow you to:
- Identify potential problems early on and to fix them before they become a deal breaker or valuation problem
- Identify the assets to be sold and handle any items that should not be part of the sale (e.g. IP, real estate)
- Understand what impact the transaction will have on the vendor (e.g. shared infrastructure, sales synergies, financing synergies)
- Develop your preferred transaction structure and key deal terms
- Collect all necessary information for the sales documentation (teaser, deal memo, management presentation), the first valuation and the data room documentation, to identify any gaps, problems and action points
- Have a clear understanding of your starting position in the negotiation and the opportunity to prepare your lines of argumentation to maximize value from your strengths and mitigate/optimize the effect of your weaknesses
The result of this is not only clarity on the action plan to maximize the valuation, but also an important opportunity to evaluate whether the sale of the unit really is the best way forward.
Post by M. Hirt