Services Offered
Valuation Insight (VI) is a professional business consulting firm that specializes in providing expert M&A transaction advisory services and transaction representation to the owners of companies operating in the service industries. VI is fully capable of providing our services to either “sell-side” or “buy-side” parties. Our sell-side services are typically provided to clients who are the owners of privately-held service companies, while our buy-side services are usually provided to private equity firms and publicly traded corporations requiring expert assistance with business acquisition transactions.
Whether selling or buying a business, it can be a highly complex process with many potential pitfalls along the way. At VI we analyze and manage every aspect of the business sale or business acquisition process; we solve for a financial valuation of the business; we negotiate a transaction price and deal structure that attains your financial goals; and, we get the transaction closed on terms that are acceptable to you.
The services described below are primarily associated with sell-side transactions, since there are typically many more detailed activities performed in connection with these type of M&A projects.
The services provided by VI for buy-side transactions are generally the same (but with many less activities required in most cases); except our services are performed from the perspective of “the other side of the table”. For a detailed listing of services provided by VI for buy-side transactions, please contact us and we’ll be happy to provide this information.
Our business sale services include:
Initial Discussions
Many business owners (and income-producing property owners) are not certain about when, or even if, they should sell their company. VI will initially consult with you regarding basic business sale issues such as these on a no-obligation, confidential basis to help provide guidance concerning your options.
Subsequent to this discussion, VI may recommend that you initiate certain changes to prepare and position the business and/or property for sale. Our goal is to help increase the probability that you will ultimately receive the maximum sale price for your investment.
Business Valuation
After we are retained as your Consultant, VI will perform complex financial analysis to determine a preliminary Fair Market Value of the business and calculate a potential sale price (or minimally a “price range”).
This process will also include the compilation of a market analysis of the area serviced by the business, and an assessment of all businesses (i.e., competitors) providing the same services within the market area where your business is located. VI will work with you to assist in determining an estimated fair market valuation and Sale Price range, taking into consideration average purchase price multiples (i.e., a multiple of annual Cash Flow) being paid for similar businesses by Buyers based on current market conditions.
Potential Buyer Identification & Screening
After all acquisition proposals have been received from prospective Buyers, VI will work with the Sellers to review, compare and evaluate the Acquisition Proposals received. Since Acquisition Proposals can often be complex and vary in structure, VI will perform detailed present value financial analysis and other evaluation procedures for the purpose of determining the proposal that is in the best interest of the Sellers.
VI will then prepare a summary of all Acquisition Proposals received, so that the Sellers are able to make a fair comparison and make a decision as to which proposal to accept. VI will then contact the prospective Buyer whom has been selected by the Seller to notify them that their proposal has been deemed acceptable, and request that the prospective Buyer submit a formal Letter of Intent.
VI will coordinate the form that the Letter of Intent should take and establish a schedule for submission of this formal proposal. VI will then work with the Sellers to finalize the terms and language of the Letter of Intent, and endure that is properly executed by all parties.
Confidentiality Agreement
VI will oversee the preparation of Confidentiality Agreements and manage the process of ensuring that all such Agreements are properly executed before any confidential information is revealed to any prospective Buyer.
Confidential Information Memorandum
VI will oversee the preparation of Confidentiality Agreements and manage the process of ensuring that all such Agreements are properly executed before any confidential information is revealed to any prospective Buyer.
Transaction Structuring
VI will advise you on the alternatives that are available for structuring a transaction and provide advice regarding the types of transaction structures you might expect to receive from prospective Buyers, prior to the acquisition proposals actually being submitted.
VI will advise you on the various “pros and cons” of alternative transaction structures from a variety of perspectives such as: Purchase (or Sale) Price consideration (i.e., cash versus stock, or a mix); “Earn-out” provisions of proposals; Revenue Guarantee provisions of proposals; risks associated with “Holdback” and “Indemnification” provisions as they relate to a proposed transaction structure; tax considerations; employment agreements; non-competition agreements; etc.
Proactive Management of The Business Sale Process
VI will lead, manage and coordinate the entire business sale process from start through to the Closing. After the CIM has been distributed to prospective Buyers (which we will pre-qualify), Acquisition Proposals will be received from these parties based upon a predetermined schedule that we will establish with your input.
As part of the Acquisition Proposal compilation process, each prospective Buyer will typically need to conduct site visits and meet with representatives of VI (and sometimes the Sellers) for the purpose of receiving clarification on any questions they may have accumulated after reviewing the CIM.
VI will coordinate these site visits, coordinate all communications with prospective Buyers, coordinate any meetings that are deemed necessary and distribute any supplemental information that is accumulated subsequent to the distribution of the original CIM.
Selection of the Best Proposal
After all acquisition proposals have been received from prospective Buyers, VI will work with the Sellers to review, compare and evaluate the Acquisition Proposals received. Since Acquisition Proposals can often be complex and vary in structure, VI will perform detailed present value financial analysis and other evaluation procedures for the purpose of determining the proposal that is in the best interest of the Sellers.
VI will then prepare a summary of all Acquisition Proposals received, so that the Sellers are able to make a fair comparison and make a decision as to which proposal to accept. VI will then contact the prospective Buyer whom has been selected by the Seller to notify them that their proposal has been deemed acceptable, and request that the prospective Buyer submit a formal Letter of Intent.
VI will coordinate the form that the Letter of Intent should take and establish a schedule for submission of this formal proposal. VI will then work with the Sellers to finalize the terms and language of the Letter of Intent, and endure that is properly executed by all parties.
Coordination of Due Diligence Activities
VI will assist you in compiling all of the information requested by the potential Buyer which they will require as part of their due diligence process, and coordinate the development of a data room where the due diligence documents will be available for review by the prospective Buyer.
VI will also accompany the potential Buyer on any physical site visits and equipment/property inspections, which are a customary part of the due diligence process when selling or buying a business.
Negotiation of the Final Sale & Purchase Agreement
VI will assist you in compiling all of the information requested by the potential Buyer which they will require as part of their due diligence process, and coordinate the development of a data room where the due diligence documents will be available for review by the prospective Buyer.
VI will also accompany the potential Buyer on any physical site visits and equipment/property inspections, which are a customary part of the due diligence process when selling or buying a business.
The Transaction Closing
VI will plan and coordinate all aspects of the transaction closing process. VI will also attend the Closing and work with you, your attorney and accountant to successfully consummate the transaction. The transaction does not end at the Closing, so VI will also compile a complete listing of any post-Closing events that are scheduled, to ensure there are no “loose ends” remaining after the transaction is completed.
Other Noteworthy Information:
Professional Resources
VI does not provide legal representation, certified appraisal services or engineering services. However, VI does maintain affiliations and relationships with highly experienced contract law/transactional attorneys, certified appraisers, engineering firms, private equity firms and other professional service firms that specialize in mergers and acquisitions.
For example: If you do not already have your own attorney selected to prepare the legal documents and Agreement associated with the prospective transaction, VI maintains contacts with many highly qualified attorneys who specialize on contract law and Purchase & Sale Agreements. You will then be able to interview, select and retain an attorney to handle the legal aspects of the transaction. We’re also able to recommend other highly qualified professional service firms (i.e., engineering firms, CPA firms, etc.,) in the event their services are deemed to be necessary in order to complete the transaction.
Guaranteed Confidentiality
At Valuation Insight we recognize that the value and reputation of a business can potentially be harmed when the wrong parties learn that a business is either for sale or available for acquisition. A company’s customer base, its employees, its vendors, its banking relationships, and even its competitive position can be adversely affected if this occurs.
Hence, it is imperative that all communications concerning the potential sale or acquisition of a business remain strictly confidential. Any dealings between you and representatives of Valuation Insight are always treated with the utmost confidentiality … you have our word on it.