Selling a Business

It takes hard work to create a successful business. Inevitably, for most entrepreneurs, there comes a time when it's time to leave the business they've invested so much in and sacrificed so much for. But the question is... What happens next?
Most business owners have several key goals in mind:

  • Receive the highest possible price
  • Keep the sale confidential
  • Pay as little tax as possible
  • Ensure smooth transition for employees
  • Maintain the legacy that was built
Selling a business is one of the most complex and distracting processes a business owner can undertake. The right business broker can make the difference between a smooth sale and a difficult one. With ABI’s help, these goals can be achieved as our approach is designed to successfully sell your business to the best buyer for the maximum price while minimizing distractions to the day-to-day operations.

Our 4-Step Process

1. Inquiry, Analysis and Decision to Sell
During the initial stage, the ABI advisor (or advisory team) will gather information about the owner’s current situation and objectives. We’ll offer insight into value drivers and the marketability of the business along with our best assessment and custom approach to sell the business.

2. Preparation, Value Assessment & Custom Marketing Plan
Preparation is paramount to finding the right buyer. Using either internal or third party appraisal resources, a “most probable selling price range” will be calculated and a valuation report provided to help establish a market-oriented price for the business. At the end of this stage, both ABI and client have agreed upon pricing expectations prior to moving forward. From here, a custom marketing plan to target prospective buyers (through various channels) and materials are created, including a confidential profile and an offering memorandum.

3. Marketing to and Searching for a Buyer
Once business pricing and a marketing approach have been agreed upon, the search for a buyer begins. During this stage, ABI identifies and communicates confidentially with all prospective buyers by utilizing our internal database of active buyers, advertising on business-for-sale websites, direct marketing to strategic prospects identified with client and leveraging our relationships with hundreds of private equity groups. We communicate with all interested parties but only allow pre-screened buyers to meet our client.

4. Negotiations, Due Diligence, & Closing
Once an offer has been tendered, negotiations begin. ABI presents all reasonable offers and will discuss the pros and cons of each opportunity. Many deals fall apart in due diligence, thus we carefully manage this process to keep it moving forward and focused. We deal with Bulk Sale Transfer laws and Escrow processes daily and understand what it takes to maintain compliance and always use a licensed escrow officer. Our focus is to manage the process, along with the client’s other key advisors in order to help Buyer and Seller get to the closing table and transition successfully.

Working with Buyers: Understanding their Differences

Acquiring entities are driven by a variety of motivations. The general categories will guide the process and deal structure. It is important for Owners to understand ahead of time how expectations may vary.

Entrepreneurs

Individuals or partners or a family head interested in replacing a job as an owner/operator or other source of income. Their focus will be based on analyzing if their skillset can replace the roles of the current owner/s and understanding the true cash flow to see if it will fit their needs.They also always come to the table seeking an entity that they can improve and also grow and expand.

Investors – Financial

Investor clients, such as private equity groups or high net worth individuals, are interested in acquiring companies which can provide attractive financial returns on their investment such as through making operational improvements, or by providing increased access to capital. Many times an investor-acquired company will serve as a platform for growth or as an add-on to a platform company. Platform companies within institutional investor portfolios can also be considered strategic buyers when the goals of the strategic buyer ultimately accrue to the financial benefit of the investor.

Companies – Synergistic or Strategic

This group of buyers consists of corporate or smaller-company clients seeking to acquire a company to achieve growth or other strategic objectives. Oftentimes they want to expand through staff acquisition, geographic location or via a vertical integration of complementary services or products. Occasionally we see buyers that just want to scoop up competition. 

Regardless, having a clear understanding of the buyer’s motivation will help the seller and their advisor analyze the strategic fit and goals.

Reach out to one of our associates for a Confidential Conversation