We help our clients design an optimal liquidity strategy by carefully assessing client-specific and current market factors.
Sell-Side Strategies
Preemptive
Description
- Identify and Screen the most likely buyer universe which often includes both strategic and equity sponsors
Number of Buyers
- 1
Advantages
- Efforts focused on one buyer
- Maximum confidentiality
Disadvantages
- Unlikely to maximize value
- Tied to result of one negotiation which is risky
- High Risk with low probability of close
Considerations
- Have very clear sense of most logical buyer
- High risk of damage from business disruption
Targeted Solicitation
Description
- High-level approach to selected potential buyers
- Customized Offering Memorandum
Number of Buyers
- 2-10
Advantages
- Sense of competition enabled
- Avoids perception that property is being shopped
- Deep industry expertise and knowledge of the market is invaluable
Disadvantages
- Requires top-level management time commitment
- Often maximizes shareholder value
Considerations
- Have limited group of logical buyers
- Have key objectives of confidentiality and limiting any business disruption
Controlled Auction
Description
- Limited range of logical potential buyers contacted
- Requires formal guidelines on sale process and timeline
Number of Buyers
- 10-25
Advantages
- High degree of control over process, with multiple rounds of offers
- Creates strong sense of competition
- Maximizes shareholder value
Disadvantages
- Limited confidentiality
- Potential for disruption due to rumors
Considerations
- Seek good balance between confidentiality and value
- Leave no money on the table and extract maximum value
Public Auction
Description
- Public disclosure made
- Preliminary materials distributed to wide range of potential buyers
Number of Buyers
- 25+
Advantages
- Most likely to obtain highest offer
- Finds hidden buyers and Agile expands to International buyers
Disadvantages
- Risk of business disruption but avoidable with third party advisors
Considerations
- Believe business is unlikely to be damaged by public process and focus on maximizing shareholder value
M&A Workflow and Timeline
Best Practice Approach from twenty years of experience and 210+ completed transactions.
Initial Groundwork
Planning
- Identify the universe of potential acquirers
- Strategic acquirers and private equity (PE) sponsors
Preparation
- Compile all due diligence, develop and finalize long-term strategy
- Establish an online virtual data room (VDR) and all documentation
Positioning
- Highlight unique and distinguishable platform characteristics
- Build the business case and strategic rationale for each buyer
Packaging
- Strong Offering Memorandum, Teaser and Management Presentation
- Go to market with Quality of Earnings Report to insure accurate financial reporting that confirms revenue and EBITDA
Execution
Weeks 1–4
PHASE 1
Kick-off & Preparation
- Define objectives and marketing strategy
- Conduct operational, financial and legal due diligence
- Develop preliminary valuation
- Develop positioning and marketing thesis
- Meet attorneys, accountants and other company consultants
- Set process timeline
Weeks 3–5
PHASE 2
Marketing Materials
- Define key selling points
- Prepare descriptive memorandum & other key marketing materials (e.g.
- management presentation)
- Identify potential investors (tiers I, II and III)
- Finalize contact strategy for each type of investor
Weeks 5–9
PHASE 2a
Marketing
- Contact buyer universe and describe points of uniqueness of the business
- Provide Offering Memorandum and Management Presentation
- Provide buyers with bid letter for Indication of Interest
Weeks 9–17
PHASE 4
Investor Due Diligence
- Shortlist investors based on various criteria
- Invite short-listed investors for due diligence visits
- Management delivers presentation
- Distribute contracts for markups
- Request final binding bids
Weeks 17–20
PHASE 5
Finalize Bids, Negotiations & Closing
- Negotiate final offers
- Finalize contracts with markups
- Public announcement
- Pursue HSR and any other required filings/approvals to closing
- Close transaction