This book is a detailed guide to the entire process, starting with the initial contacts, through the negotiation and implementation of the deal, and ending with the post-acquisition period.
First, the seller assesses the business and prepares the information to be provided to potential buyers. Initial contact is made anonymously. Interested parties sign a confidentiality agreement in order to receive the sales booklet (detailed description of the business) and to negotiate.
At the end of the negotiations, the potential buyers submit their offers in the form of a letter of intent, which defines the fixed and variable (earn-out) price, the form of payment and the future cooperation of the owners.
In the case of the most interesting offer, the Letter of Intent is signed and the potential buyer carries out due diligence (fiscal, financial, legal and labour audit). Once the due diligence has been completed, the lawyers of both parties draw up the purchase agreements and the contracts are signed. This is followed by the post-acquisition phase, which is crucial for the buyer to reap all the benefits of the acquisition.
The book shows how M&A is a very powerful strategy for strategic buyers to create value through synergies, mainly by increasing sales, reducing costs and optimising the balance sheet (fixed assets and working capital).
Business owners who believe the best course of action is to sell their business will find this book of interest.
- Who are the potential buyers who can make the best offers?
- What is the value of the business?
- How do you negotiate with potential buyers?
- How to properly complete the sale and purchase transaction?
It can also be useful for strategic buyers who are considering acquiring companies to strengthen their strategic position and thus face the future with a better chance of success in an increasingly volatile, uncertain, complex and ambiguous environment.
- How to make the most of an acquisition?
- How can the value of synergies be calculated?
- How to finance the acquisition?
- How to structure earn-outs?
- How to make the offer attractive?
- How to do a good post-acquisition?
There is a chapter on private equity buyers and how they make bids that are equal to or better than those of strategic buyers. They are experts in increasing the value of the businesses they acquire and their bids are based on strategies designed to:
- Increase the company’s profits.
- Improve the strategic positioning of the business.
- Optimise the company’s assets.
It contains ten real-life cases of value creation through acquisitions that confirm the concepts described in the book.
Ramon Palacín holds a degree in Industrial Engineering from the Universitat Politècnica de Catalunya, an MBA from ESADE and a PhD in Business Administration from ESADE.
Since 1996, he has been an Associate Professor in the Department of Economics, Finance and Accounting at ESADE, where he teaches M&A, Company Valuation, Venture Capital and Private Equity for the MBA, Business Administration-BBA and various Executive Education programmes in Barcelona and Madrid.
Since 1991 he has worked at M&A Fusiones y Adquisiciones, S.L. – a consultancy firm specialising in the purchase and sale of small and medium-sized companies – and is now a partner and managing director.
He is the author of the books: “From Manager to Entrepreneur via Management Buy Out”, based on the experience of several CEOs who became entrepreneurs through the acquisition of a company, and “Value Creation. 12 strategies to double the value of a company in 4 years”, based on real cases of value creation in small and medium-sized companies.
