What’s the Point of an M&A advisor?

Mergers and acquisitions (M&A) are a component of the investment banking industry. M&A has been around for as long as various types of merchants have been transferring their enterprise to someone outside their family. Today, only a small percentage of businesses worldwide pass from one generation to the next, so M&A advisors (and business brokers who work on small transactions) have proliferated.

If you’re ready to exit your business, finding the right M&A firm is critical. It’s extremely difficult, if not impossible, for a seller of a midsize business to obtain the highest price possible at the most favorable terms without engaging an M&A firm to act as agent and intermediary. For the vast majority of sellers, doing-it-yourself is truly not the smart choice.

Just some of what a proficient M&A advisor can provide you includes:  identifying a pool of qualified buyers, creating a compelling package of marketing materials, understanding the financial and tax ramifications of various offers, and last but not least – negotiating the deal to your advantage. These abilities are based on years of acquired know-how resulting in sound judgment.

Some M&A firms rely on their relationships with a narrow pool of buyers. Others mass-market a business to over 20,000 “potential buyers,” simply because it is not costly to send out emails. The first approach does a disservice to sellers by limiting their choices; the latter risks compromising confidentiality and wastes time talking to buyers who lack the wherewithal to do a deal or are just fishing for information on the company.

Osage Advisors runs a competitive auction to help maximize the value of your business by getting buyers to bid up the price or compete with each other on terms being offered. This type of auction casts a wide net but is limited to prospective buyers who have been pre-screened and selected.

Finally, when choosing an M&A advisor to sell your business, make sure they are properly licensed to handle your specific needs. Speak to their former clients and other professionals they have done deals with such as attorneys and accountants. You won’t regret having done your own due diligence before trusting an advisor with the sale of your business.