Managing a Transaction Start to Finish
NOVEMBER 19, 2024
Preparation & Initial Considerations
Establishing a Timeline
Indication of Interest / Down Selection
(VARIES, 2-6 WEEKS)
Teaser & CIM Creation
(2-8+ WEEKS)
LOI Negotiations
(0-2 WEEKS) Closing Due Diligence & P&S Negotiations
(8-36+ WEEKS)
Transition & Continued Support (AS NEGOTIATED)
Initial Considerations –Sell Side
• Understanding Your End Goal
• Assembling an Advisory Team
- Investment Banker / Broker
- Legal Counsel
- Accountant & Tax Professional
- Wealth Management
• Business Preparation & Readiness
- Operational
- Financial
- Human Capital & HR
• Transition Preparation
• Document Prep & Marketing Preparation
Initial Considerations –Buy Side
• Target Evaluation & Fit into Strategic Planning
• Assembling an Advisory Team
- Investors / Bankers
- Diligence Team
Legal & Corporate Matters
Financial & Tax
Operations & Environmental
- Transition Management
• Synergy & Sustainability Assessment
- Operational Preparation
- Human Capital / HR
• Liquidity & Funding Arrangements
• Existing/Future State Debt Service Coverage & Covenant Evaluation
Marketing & Solicitation
• Teaser – Confidential & High Level
- 1-2 Pages Focused on Broad Financials & KPI’s / Business Highlights
• Confidential Information Memorandum
- Detailed story book of the business, while still maintaining confidentiality
- Additional Layers of Finance, Operations, Customer/Vendor Spreads, Key Management Personnel, etc.
• Optional – Sell Side Quality of Earnings Report
• Indication of Interest
• Letter of Intent & Exclusivity
Due Diligence & Quality of Earnings Reporting
DUE DILIGENCE:
• Factual & Transaction Based
- Corporate Structuring & Compliance Review
QUALITY OF EARNINGS:
• Analytical & Forward Looking
- Industry Trend Analysis & Outlook
- Financial Review
- Tax Review
- Legal & HR Review
- Environmental/EH&S Review
- Normalization of Financials
- Customer/Vendor Evaluation
- Contract Review
Closing Day & Post Closing Items
• Closing Day
- Final Go/No Go Meeting Across Parties & Approval of Fund Flow
- P&S Consummation
- Wire Transfers
• Post Closing (90-120 Days)
- Net Working Capital True Up
- Escrow Releases (Working Capital)
• Post Closing (180-365+ Days)
- Installment / Earn Out / Non-Cash At Closing Monitoring & Settlements
- Escrow Releases (Indemnification)
Other Considerations
• Team Communications & Involvement
• Real Estate / Lease Agreements
• Employment Agreements (Owner & KMP)
• Integration Process
• Tax Planning
• Banking Unwinding
• Customer/Vendor Communications
