Selling a Company: Not an End, But a Transition
It is the final step for most entrepreneurs in their "entrepreneurial career": selling the company. Yet this important step is often seen as the end of a company's story, a final act � but it is actually another step in the development of a business. A decisive step that gives employees and customers a new perspective and allows the company to live on beyond one's own "(working) time".
This development often begins on the 60th birthday. The big 6-0. Now it's here. "Only five more years � then I'd reach a good retirement age. Although: Did I really take on this enormous risk just to have to work until retirement?" many ask themselves. And usually answer their own question with: "Maybe it's time to start looking around."
Where Does the Company Sale Begin?
But where do you start the journey of selling a company? How do you actually sell your own business? How do I know what my company is worth? And above all: Who will pay me the price I want for my company?
Questions that are not so easy to answer if you have previously focused more on operational or technical matters in your life.
Why M&A Advisors Are Important
The answer is actually quite easy to give with a counter-question: If you have a legal case � who do you turn to? Your lawyer. If your car needs repair � who do you turn to? A workshop. If you have knee problems � who do you turn to? An orthopedist.
Meaning: You usually turn to the specialists in each field. When selling a company, these specialists are the M&A advisors � also called succession consultants for company sales.
They know the entire procedure of a company sale in detail. They have the network to potential buyers. They are often also the sounding board and firewall to the buyer. Good sell-side M&A advisors represent your interests as if it were their own company.
They analyze the greatest unique selling points, competitive advantages, and identify lost EBITDA in their information memoranda. They draft business plans and accompany the letter-of-intent negotiations, which ultimately culminate in the purchase agreement.
Corporate M&A Advisory or M&A Boutique?
What Is a Corporate M&A Advisory?
Corporate M&A advisories are companies with several thousand advisors worldwide. They often advise corporations or larger companies above a certain revenue size. In addition to pure M&A transaction advisory, they often offer other services for the buy-side � such as Financial Due Diligence (FDD), Legal Due Diligence (LDD), and sometimes post-merger integration.
Their advantages: international networking, deep industry experience, and large internal resources. In their working style, they often resemble "generalists".
What Is an M&A Boutique?
M&A boutiques, on the other hand, are usually smaller, specialized advisory firms (<50 employees). In most cases, they have a clear industry focus and � with regard to German M&A boutiques � are active in the DACH region, with projects that also extend to the EU area.
Their advantage: a tight network of strategic buyers in specific focus industries as well as detailed knowledge of industry-typical multipliers and deal structures. M&A boutiques also score points with leaner processes and specialized teams, which often leads to more attractive pricing models. They resemble individual "specialists".
Which Advisory Fits My Company?
Ultimately, it is impossible to say in general terms which path is the right one � because depending on the situation, there are different requirements and objectives. If you are selling a company with several international branches and complex know-how across different legal systems, a globally positioned corporate advisory with worldwide offices may be the right choice � corporations advise corporations.
But corporations also specifically turn to M&A boutiques when it comes to deep industry understanding and tailored analyses � and to obtain high-quality, detailed information memoranda.
Hop or top � as in life � rarely exists in absolutes. In the end, it is not the size of the advisory that matters, but whether it fits the next step in your company's story.
Disclaimer
This article has been prepared with the greatest care and to the best of our knowledge. Nevertheless, no guarantee can be given for the accuracy, completeness, or timeliness of the content. The information is provided for general informational purposes only and does not constitute legal, tax, or business strategic advice. Individual review by qualified professionals is expressly recommended.
The author and Adams Strategy assume no liability whatsoever for any decisions or actions taken based on this article.
Note: This article is part of our healthcare industry series. Contact us at valuation@adamsstrategy.de for M&A advisory in the healthcare sector.