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VICTORY PARTNERS' ROLE AS YOUR SELL SIDE ADVISOR
Victory's singular focus on our client's ultimate goals drives the entire process. Our team will work closely with you to fully understand your desired outcomes, while at the same time, maintaining a realistic objectivity about those goals, and then design a specially tailored marketing program to achieve them.
We have the experience to understand the mind-set of the buyer. The acquiring companies can include private companies, divisions of larger companies, publicly traded companies, or private equity funds. Each type of acquirer offers its own set of benefits and opportunities. Understanding the potential synergistic benefits to the acquirer is invaluable to the selection and negotiation process.
Victory controls the process: we bring the qualified buyers into the process; dictate the timing of deadlines for indications of interest; create an "auction" environment where several buyers compete to acquire the company; select the winning bid and negotiate the final transaction agreement. All, the while, maintaining the strictest of confidence. We know the optimum value of your business and the added negotiating power of dealing with multiple buyers. Our marketing program is designed to target the most logical possible acquirers and gain maximum leverage during the process.
SOME FAQs:
- I can sell my company myself. Why do I need an investment banker, like Victory Partners?
This is probably the question that is most frequently asked by owners of privately held businesses. You may seriously handicap yourself by undertaking the sale of your business without an investment banker. Just as you did not acquire the skills needed to run your business overnight, an investment banker likewise brings years of mergers, acquisitions, and financing experience to his area of specialization. Moreover, he has the extensive resources and sophistication that only an investment banking firm can provide to market your business most effectively to attract several "premium" buyers. The sale of a private company for a premium, requires extensive computerized buyer and industry data bases, relationships with the financial community, expertise at valuing and marketing companies, and detailed knowledge and careful consideration of tax, legal, accounting and regulatory issues.
- But I know my business better than anyone else. Therefore, am I not the best person to sell it?
As an owner, you have a significant emotional stake in your business. While this trait has been invaluable in getting you where you are today, it can (and usually does) hinder an owner's objectivity in valuing the company, identifying the best buyers, marketing the company, and negotiating the best transaction. In particular, it is difficult for an owner of a business not to be influenced by personal knowledge of that business. Your contacts, for instance, are likely to be within your own industry. Frequently, however, the best price can be obtained from a buyer whom the seller may not have considered, or by using a financing structure with which you may not be familiar. Furthermore, the process is highly involved and can consume an owner's time, distracting him/her from running and growing the business.
- I am a good negotiator. I'm not convinced that a Wall Street investment banker can hammer out a better deal.
Most buyers of private businesses are skilled in the process of negotiation for the acquisition of companies and are objective. Also, it is unlikely that your business will be your buyer's first purchase. No matter how sophisticated you are in the art of negotiation, your limited experience in the specific bargaining disciplines of the corporate selling process may put you at a severe disadvantage. In addition, head to head negotiating can derail an auction process between several "premium" buyers. Most importantly, being represented by a professional firm brings instant credibility to the process and flushes out "non-qualified" buyers.
- Well, I still think my deal is more important to me than to any investment banker. I don't like the idea of giving up control, especially since I never have in the past.
In fact, an investment banker gives you more control because he acts as an important buffer between you and the buyer. When dealing with a number of potentially qualified buyers, it is important for a seller to be able to buy time and avoid confrontations with these buyers over price and terms until he is ready to decide among offers. This is much easier if the investment banker, who, after all, can't commit the seller, can collect responses and act as an intermediary.
- What about the fees that investment bankers charge?
Because the investment banker adds value to your transaction, the fees should be more than made up for by the higher price that a professional will be able to elicit from the ultimate buyer. In addition, the speed with which the experienced investment banker can execute the entire selling process translates into a higher sales price in a number of ways. First, the sale will take less of your time, leaving you more time to run your business. Second, timing can be critical not only in the time value of sale proceeds ultimately received, but in the opportunity lost should market and business conditions move against you.
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