Tech M&A Myth #5: Having an Intermediary Can Scare Buyers & Kill the Deal

Many sellers are misinformed on this point. They think that buyers prefer that sellers avoid working with an M&A advisor. In fact, serious buyers prefer the opposite:  that you have a skilled intermediary on your side. It almost seems counter-intuitive when you consider that my job is to get the best valuation and deal terms possible for the seller. So why would professional buyers prefer that you have a skilled advisor and why do they gravitate toward M&A opportunities where a professional advisor like Corum is involved? Here are some of the reasons.

 

  1. Our involvement sends a very important message.  It says that you are serious, committed and have invested in the outcome.  It means that your approach is premeditated, organized, measured and professionally run. It will also be free of the artificial barriers and emotionality that come with self-run processes.
  2. An experienced advisor knows how to communicate with buyers on their terms. We understand how buyers behave, the processes they must follow, the complexities of compliance and approvals they need.
  3. Complications arise for both parties. They always do. Your advisor is your expert in dealing with these complications. Buyers actually prefer to negotiate the tough points of a deal with an experienced advisor rather than directly with the seller. So let your advisor be the lightening rod for you on difficult issues.
  4. Advisor-led deals have a much higher close rate than self-run deals. Buyers have too many deals to evaluate these days and they can’t afford to chase good companies that are using a bad process.

 

Most good companies get unsolicited approaches from buyers. So don’t be hesitant to involve your advisor at Corum to help you make the most of the opportunity.

Posted by , Senior Vice President on 5 September 2014
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