What do SMEs want from their corporate advisers?
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Like any other company executive, a business owner will want to achieve the best price for their business, whatever their motivation for the sale. But they also want tailored advice from someone who understands the particular issues SMEs face, from their cashflows to their competitors. Here are four things you might find on an SME’s wish list when the time comes to sell:
Uncover hidden buyers
A crucial part of the corporate adviser’s job is to research potential buyers who will understand the value of your business, its growth prospects, and why it is worth a premium price. Using their research skills, contacts and experience in your industry, they will be able to target and approach buyers you may not have thought of – for example, businesses located overseas or outside your sector.
Achieve the best price
Valuing your business correctly is crucial to make sure the outcome of the deal exceeds your expectations. A good corporate adviser will have an in-depth knowledge of the sector in which your company operates, its position in the market and how it compares to its rivals. They can advise you on structural or other strategic changes you could make to your company to before putting it up for sale, which could increase its value. They will present your business’s vital statistics to potential buyers in the right way – from realistic cashflow forecasting to profit multiples and dividend projections. Your deal executive will then negotiate with would-be buyers to seal the deal at the best possible price.
Cover all bases
You will want to make sure every base is covered to ensure a smooth corporate transaction. This means having an expert iron out any potential tax, accounting, legal or regulatory issues, and oversee the due diligence process. You will also want to know that your heads of agreement is solid and covers every eventuality before it becomes legally binding, to prevent any problems arising in future.
SMEs need to be able to trust their adviser to maintain confidentiality in the delicate and often complex process of selling their business. Listed companies in particular will want to avoid information about their deal leaking into the market in case it moves their shares. A corporate adviser should make sure all parties interested in your business sign a non-disclosure agreement before they are given any commercially sensitive information. Meanwhile, good communication is important at every stage so you are always kept in the loop. Ideally you would want to have the same executives working on your deal from start to finish so there is continuity throughout.