Mergers & Acquisitions – They say selling a business is an art – we’ve turned it into a science
Schedule a Consultation
Businesses for SaleMorgan & Westfield is committed to making the process of buying a business as simple as possible. Browse our businesses for sale now.
Buyer’s GuideHere is an overview of the process of buying a business, presented in concise summaries from our experts.
Food and BeverageFrom processing and manufacturing to production and distribution, we’ll give you the advice you need to maximize the value of your company when it comes time to sell.
ServicesBusiness services firms differ in the services they offer, so we customize our solutions to meet and exceed clients’ service goals.
Home and Building ServicesMorgan & Westfield serves as a trusted partner to plumbing and HVAC businesses, mechanical and commercial contractors, and other home service enterprises looking to sell.
Negotiating a clear letter of intent keeps a seller’s position strong throughout the sale process. Bill Snow returns to discuss the top four mistakes sellers make with the LOI and his tips on avoiding these issues. He highlights the importance of planning for taxes and understanding the tax implications of a sale from the outset, how valuations vary and what can impact them, setting up a data room for due diligence before the LOI stage, the dangers of having unrealistic expectations, and the costs of not being prepared.
Listen on Apple Podcasts | Listen on Spotify | Listen on Deezer | Listen on Pandora | Listen on Google Podcasts | Listen on TuneIn
| 2:23 What is the importance of the letter of intent (LOI)? |
| 6:15 If there is not much detail in the LOI, does it work in the favor of the buyer or the seller? |
| 8:04 What are the four biggest mistakes sellers make while negotiating the LOI? |
| Issue 1 – Not planning for taxes |
| 12:15 How do accountants or tax advisors factor in the negotiations of an M&A transaction? |
| Issue 2 – Understanding the tax implications |
| 17:19 Why is it important for sellers to understand the tax implications of selling their business before they negotiate an LOI? |
| 18:45 What is a “country club valuation”? |
| 24:43 How accurately can a valuation be predicted? |
| 26:49 How can synergies with strategic buyers impact the valuation and purchase price? |
| Issue 3 – Lack of preparation |
| 32:11 What tends to slow down LOI negotiations the most? |
| 36:05 Why is it so important to have a data room populated with all of the documents necessary for due diligence before signing the LOI? |
| 39:58 How much time and money does the typical buyer invest in due diligence? |
| 44:09 What can happen if a seller is unprepared or has incorrect information in the data room? |
| Issue 4 – Unrealistic expectations |
| 47:24 What is an example of a lesson learned from having mistakes in due diligence paperwork? |
| 49:28 What does the country club number really mean, and how does it vary from an actual purchase price number? |
| 53:31 What role do earnouts play in negotiating a transaction? |
| 56:04 What should a seller know about an escrow account that is tied to reps and warranties? |
| 59:21 What is the most important lesson for sellers? |
Selling your business is a big deal – let us handle the details while you run your business.
Explore Your Options Now
Investment Banker
Bill Snow is an investment banker with over 30 years of experience in mergers and acquisitions, and he is currently with FOCUS Bankers. Renowned for his extensive expertise in representing buyers and sellers across diverse industries, Bill became a Managing Director at Jordan Knauff & Company in 2013. Prior to this role, he held a leadership position in the investment banking practice at Cambridge Partners & Associates. During his tenure at the investment bank Kinsella Group Inc., Bill provided valuable advice to middle-market business owners and executives on both sell-side and buy-side transactions.
In addition to his work in M&A, Bill has authored three books, including Mergers & Acquisitions For Dummies (Wiley Publishing, Inc.). He is a sought-after speaker across the United States and beyond, with international lectures in Malaysia and the United Arab Emirates. Bill holds an MBA and a BS in finance from DePaul University, and he is a registered Investment Banking Representative with FINRA, the Financial Industry Regulatory Authority.
Location:
Washington, DC Metro
LinkedIn:
https://www.linkedin.com/in/billsnow
Website:
www.focusbankers.com
Email:
[email protected]
We invested over a decade perfecting every step of the process. The result is a method proven to reduce your risk and maximize your price.
View Our Process Now
Attorney | International M&A
Don’t underestimate the role and impact of human nature in M&A transactions and the power of collaboration. Julienne Baron discusses connecting the dots in M&A, including communication, the importance of…
Start-Up Acquisitions | Entrepreneur
Learn about the M&A growth of two start-ups in a new virtual business – mental health services online. William Masih discusses questions for sellers to ask themselves before considering an…
Who We Are
Our Experience
Audio
Other Resources
Let’s Talk