How M&A Advisors Add Value During Your Deal

Where does the M&A advisor add value?

If this is your first M&A deal, then you might be questioning whether or not you actually need an M&A advisor to guide you through it. Below are a few basic examples of how advisors add value during your deal and why you might want to bring them onto your team.

With Their Experience In The Industry

Advisory firms have dealt with a plethora of M&A deals, having the knowledge and experience to assist you during all the common steps in the process. A good advisor can recognize a qualified buyer for your M&A and how to appropriately represent your business in order to gain their interest early on. They have mastered the strategy of partnering buyers with sellers and understand how to facilitate a smooth transaction based on their past deals and experience in the industry.

They have also witnessed every mistake buyers or sellers make and are better able to recognize when it might happen and how to avoid it in the future. This type of knowledge is not easily replicated by someone less experienced and should be taken advantage of whenever necessary.

Their Connections In The Industry

A successful M&A deal means having the right team on your side—preferably an advisor that has enough experience and connections in the industry to lead you down the right path. After dealing with various deals they have the knowledge of appropriate software and people to make the M&A as seamless as possible.

Their goal is to market your company and show off the best version of your business to prospective buyers and in order to do that they need to know the people they are marketing you to. Their extensive familiarity with big players in the industry is an asset to finding the right buyer and pushing your deal forward. This is especially helpful for any complex or uncommon situations where an additional professional would be needed to lend a helping hand.   

With Management Of Costs And Other Aspects Of The Process

M&As are time-consuming and somewhat costly processes, so having an advisor there to help manage it is vital in having a smooth transaction. Firmex and Divestopedia have just released their 2018-2019 M&A Fee Guide that outlines what exactly goes into these processes and what it can cost, based off of research attained from advisors in the industry.

Alongside managing costs, such as a secure virtual data room to store confidential data during due diligence, they also manage meetings and presentations so that you don’t lose sight of maintaining your business’s growth during the sale. This can prove very helpful when a deal drags on for a bit longer than expected—their experience makes them better able to regain control and possibly revive a dying deal.

By Preparing Information Before the Sale

It need not be stated that an M&A requires a lot of information to be recorded, attained, and shared throughout the process within a virtual data room. Your advisor is there to ensure that you provide all the necessary documentation during due diligence so as to maintain accountability with your buyer as well as securing signatures for vital forms, such as NDAs.

They also uncover any issues within your business that might prove to be troublesome later on down the line during the M&A and work with you to fix them. Your advisor acts as an intermediary between you and your buyer, learning what information a buyer might want to see before closing a deal and protecting you from sharing more information than necessary too early into the M&A. The more credible you appear to your buyer, the easier it will be to sell your business.

Bottom Line

Advisors are integral parts to an M&A transaction and shouldn’t be overlooked when you are thinking about selling your business. They offer support and experience during processes that you yourself may not be familiar with and help manage all the steps along the way up until your deal is finally closed.

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Brian Meiggs
Brian Meiggs
Brian Meiggs is a personal finance expert, and the founder of Gabcast, formerly SavingExpert, a personal finance site helping you make your money work for you. He helps readers bring in passive income in order to increase their saving potential and start building wealth for the future. He regularly writes about saving, budgeting, investing, and general personal finance topics aimed to help anyone save more, pay off debt, and reach financial freedom. He has been quoted as a top personal finance blogger in major publications including Insider, Yahoo! Finance, NASDAQ, Discover, MSN Money and more.