Stephen Robinson, corporate finance director at PM+M
One of the things that we always encourage is to try and build a relationship with a key stakeholder on the other side.
It is that ability, if you can get some kind of relationship that’s outside of the cut and thrust of the transaction, where you can just pick up the phone and say, ‘Look, I’m not happy about this.’
Laurence O’Connor, managing director of Burnley based business advisors Financial Affairs
As a business we have planned to grow ten times the size in ten years, buy a business every year. We bought four in 18 months.
It means that when it comes to clients, I can advise them on what it feels like to sell or buy a business, I can see both sides.
At the end of the day, you’re selling your business, not because you want the cash, you want to basically align yourself to somebody who’s going to take that business forward or give you a bit of a pressure relief.
So, the fact that we might fall out during this process, afterwards we’re still going to work together. We’re still normal people, we can be grown up about it, we’ll do the deal and then we’ll move forward.
Morgan Rothwell, co-founder of design agency D&M Creative
Don’t get too giddy when you’ve got a deal in front of you. The first meeting we had with the person we bought the business from was very different to the third meeting.
That was when reality struck and you have got into the depth of the numbers. You have to know when to walk away and we did that twice before signing the deal.
Don’t lose focus on the day-to-day. If your business stops running or you stop running things can change really quickly.
Michael Conlon, chairman of Conlon Construction
You’ve got to keep the business going. We were going through some interesting times with various projects during this 18-month journey to get to the EOT.
It was a longer journey for us than I think we’d suspected at the outset, but it all had to be thrashed through properly.
I’ve found over the years that if on the other side they’re not really willing to engage in that kind of interaction, that is not necessarily a good sign in terms of how the cultural fit is going to be.
Another thing we tend to do before the lawyers are involved is scenario plan around particular issues. It is also preparing the buyer and the seller for what is actually going to come.
Don’t lose sight of what your actual key objectives are amid the twists and the turns. Don’t get emotionally involved in what appears to be a slight. Keep focused on what those objectives are.
Ben Smith, director at independent financial advisory firm Interpath
We are owned by a private equity business and they are very hands off. We’ve come through three or four of our own acquisitions in the past couple of years.
That’s what you want from a PE partner, someone that’s going to leave you to get on with running the business, support when you need it, particularly with financial support, but is not going to be too intrusive on the day-to-day.
You can have a bean counter putting two businesses together and going, ‘Yes, that makes sense on a spreadsheet, do the deal,’ but if the culture’s not right that deal will collapse.
You get a really good sense of what the other party’s going to be like as an owner post-deal. If they’re chipping you through the process, it probably doesn’t bode well for what life’s going to look like after the deal.
Richard Robinson, corporate law partner at Napthens
Our job as professional advisors is around ‘the culture’ of a deal. Normally on any deal there are five points and really the race is to get to those as quickly as possible.
If there are fallings out, sometimes you go into that room and you take the hit for your client, so you protect the relationship amongst the clients.
Sometimes you do have to go in there and create hell. Sometimes if you’ve got US buyers you know there’s going to be a price chip.
That isn’t an offensive thing, it’s a cultural thing from the States and you’ve got to protect your clients sometimes from getting offended by PE.
Make sure you’ve got enough resource around you, both professional advice and internally. Get a good team around you.
64 DOING THE DEAL
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