Introduction to the series on Exit planning Strategies

Every business owner will have to face at a point of time the transition of ownership and the succession of management of his/ her business. This is the most difficult challenges that they will ever encounter.  Business owners have devoted their lives to their business and suddenly they have to decide what will become of the organisation, and what will be the return on what is likely their most valuable financial asset.

Our expertise advising business owners to exit their business has demonstrated that it is an area in which they are poorly prepared. The critical—and complex—decisions they will be confronted with in this process occur only once in a lifetime. They have no idea of the monumental task surrounding their exit.

Should the business be sold? When should it be sold? How is the business to be valued?

Should there be an outright sale?  Should it be sold to a minority interest?  Should  the business envisage an IPO? Transfer the business to employees?  Transfer the business to family members? Should it be recapitalised?

Very often goals of seller and buyer are divergent; the tax, funding and legal implications of the transaction can make a great difference on the net proceed of the deal. All these complex choices can quickly become provoking.

We hope that this series will help business owners in the development and execution of an effective exit strategy.We will explore: 

• How to develop an effective exit strategy—setting the appropriate objectives and understanding the importance of effective and early planning

• How to transfer the business to get the optimum outcome: what are the different types of buyers? What is the buyer’s agenda? Is it better to sell to a capital venture or a strategic buyer?  Should the owner keep managing the business while transitioning? Should the owner keep control for a while? What should be the appropriate transaction structure?  How can buyer and seller objectives be reconciled?

• How to prepare the Business for Sale:  How is the business valued? When is a good time to sell? Before selling what corrective actions should a business owner initiate to enhance the value of the business? How to prepare for a smooth due diligence process? How to preserve employee interest in the transaction?

• What Processes should be in place:  to manage smoothly the due diligence, make sure that advisors are effectively coordinated, conduct efficient negotiations and get satisfactory closing, avoid pitfalls and optimise taxes.

If you envisage totransition out of your business in the near future and would want to explore what you should do please do not hesitate to call Jean-Bertrand de Lartigue on +44 1656 766 363 or e- mail him at JB@macint.co.uk