At McAvoy & Associates we understand that for companies to achieve growth and expansion they may have to consider a merger or an acquisition.
Our Business Advisory team has a particular specialism in mergers and acquisitions for both small to medium-sized organisations and can advise clients through all stages of each of these processes.
Typical problems that we come across
- Rushing the transaction – Pressures to close the deal quickly can result in rushed decisions and limit the value that the financial and legal due diligence processes should bring.
- Lack of proper due diligence – Just because a business appears to be successful and is showing a profit, does not mean that it is not without its problems. A successful acquirer will need to find out exactly what is owned, borrowed, leased, and owed before becoming committed to a transaction.
- Taking on too much debt – Purchasers, typically, enter into a transaction in an optimistic frame of mind. This can lead to misplaced confidence in the target’s ability to generate profits and hence to over-borrowing to finance the purchase. We find that over-borrowing is a common problem. A purchaser may be better off either waiting until sufficient funds become available to purchase without significant debt or putting together a buying team.
- Failure to understand the reason the business is being sold – A vendor may explain-away the decision to sell simply by saying that he/she is retiring. It always pays to investigate the background to a sale. For example, a significant competitor could be planning to move into the target’s sector and this could have persuaded the owner to retire.
How we can help
Our experienced business advisory team will:
- Evaluate the purchase opportunity from a financial and commercial perspective
- If required, assist with the identification, evaluation and valuation of other potential targets
- Provide advice on deal-structuring options and advise on the funding options for the transaction
- Assist with the negotiations with the vendor
- Provide due diligence services
- Provide project management from commencement to a successful completion
- Assist with post acquisition integration