The perfect acquirer is better equipped to make a success of your business than you are. Accepting this fact is absolutely key to finding the perfect deal – and there are a number of reasons for it. The fundamental principle is that you need to sell into growth if you want to sell successfully. At the same time, you need your acquirer to know that is your intention. Many acquirers (in fact, most acquirers) will at some stage either value your business using a multiple of earn

Far too many business owners think the deal is done when a price is agreed to, or even worse when they are introduced to someone whom they perceive to be a great acquirer. Often this is someone who treats them well and tells them how amazing their business is. This is obviously not the case, and there are numerous pitfalls along the way. You need to be clear about what the critical steps are toward closing. For example, a detailed Heads of Agreement (also called a Term Sheet

This may seem obvious, but it is often overlooked. Your lawyers and advisors work for you, and while their input is critical, the final decisions must always remain yours. At the end of the day, the only true parties to the deal are you (and any co-shareholders) and the acquirer. You have been part of the discussions and negotiations. You understand which issues are sensitive, what has been agreed explicitly and what has been implied along the way. That context cannot be dele

The answer to this question is very interesting, given that many business brokers or corporate finance advisers will see your competitors as the most obvious people to approach. However, in our experience, a direct competitor is seldom willing to pay a premium for your business. They will be very interested and will want to know absolutely everything there is to know about what you do and how you do it, but why would they pay a premium for what they believe they can do themse

There are many reasons why international acquirers look to South Africa for opportunities. We remain a good ‘springboard into Africa’, but more importantly, the country has a well-regulated economy with growth opportunities that surpass, by far, traditional growth rates in the developed world. These are obvious reasons for extending your research for acquirers into the international market. Of equal importance, though, is the influence a global strategy can have on local acq

An earn-out is a deal structure in which the seller warrants that expected profit targets will be achieved, in order to justify the sale price agreed to. Typically the deal will look something like this: The sale price (often a really impressive number) is agreed to, based on past earnings and expected future earnings. The seller typically receives about one-third of this price upfront and the balance each year for two or three years, provided the profit targets are reached.