What does an an acquisition course of appear like?
There are two sorts of acquisition processes: deliberate and opportunistic. A deliberate course of is the place an organization appears to be like for an acceptable purchaser for his or her enterprise, whereas an opportunistic course of is initiated by a purchaser.
In both case, the method begins with first constructing a robust listing of potential acquirers, as lined in Half 1 of this sequence. Then, it’s a dash with these potential acquirers that (hopefully) leads to Letters of Intent.
From there, it’s time for due diligence, which might final a number of weeks. With some luck and lots of exhausting work, the deal will shut and also you’re on to post-acquisition integration.
The procuring dash
Even when the sale value isn’t going to interrupt data, this is a chance to create a profitable final result that may maximize your long-term affect.
In an opportunistic course of, an acquirer approaches an organization it needs to purchase.
For those who’ve been approached and resolve to pursue an acquisition, you’ve a short while body to proceed that dialog and attain out to different corporations in your potential acquirers listing.
In your preliminary conversations with the lively purchaser, you’ll be able to count on to learn the way a lot they intend to supply, in addition to arrange a framework for the method.
In a deliberate course of, you management the timing, however you need to take into consideration a triggering occasion at what you are promoting that creates some time-bound stress.
In opportunistic processes, the triggering occasion is being approached by an lively purchaser. For venture-backed corporations in a deliberate course of, the triggering occasion is commonly a funding spherical. You would possibly grow to be attention-grabbing to the businesses in your listing in the event that they assume they’ll purchase you at immediately’s valuation versus at a better valuation after you’ve raised one other spherical.
That’s when issues get hectic.
The street to an LOI
No matter how the method began, you, your board and advisers have just a few quick weeks to barter with all events. As a founder, you’ll both attain out to potential patrons your self or will ask board members to take action in your behalf.