ISBN 9788130910444,Maximising Value on the Sale of a Business: Strategic and Financial Techniques

Maximising Value on the Sale of a Business: Strategic and Financial Techniques


Peter Gray


Thorogood Limited



Thorogood Limited

Publication Year 2009

ISBN 9788130910444

ISBN-10 8130910446

Paper Back

Number of Pages 92 Pages
Language (English)


Selling a business is one of the most important and stressful events in the life of any proprietor of a private company. There can never be any guarantee of success once a sale exercise is undertaken. Embarking on a sale may involve the business incurring significant costs and unexpected risks and disruption. For example, there may be breach of confidentiality which can be harmful to the business. Careful consideration of the procedures outlined in this report will help to minimise the risks and maximise the chances of achieving a successful sale of a business.

This report is primarily concerned with the sale of privately owned businesses, which are frequently family concerns. However, it also considers issues faced by quoted companies selling subsidiaries and institutional investors selling investee companies.

It commences with an overview of the current market for mergers and acquisitions and examines some of the influences on M&A activity. There then follows an analysis of the procedures involved in selling private companies and the means by which a vendor of a private company can maximise value on a sale of his business.

About the Author
Peter Gray graduated with degrees in Law and Commerce from Melbourne University in 1984. After completing an MBA in Finance at City University, Peter joined Cavendish Corporate Finance in 1994 and was appointed Director of Cavendish in 1997.

He is a frequent author and lecturer on the subject of mergers and acquisitions.

Table of Contents
Market Overview
Review of M&A activity
Drivers of the M&A market
Making the decision to sell
Reviewing the alternatives
Reviewing the shareholders' objectives
Reasons for sale
Getting the timing right
Overview of the sale process
Informal auction
Grooming a business for sale
Financial matters
Legal review
Other review
Vendor due diligence
Tax planning
Your sleeping partner- with a 40% profit share
Retirement relief - while stocks last
Re-investing the proceeds
Share exchange
Offshore trusts
Mix'n' match
Valuation techniques
Types of valuation techniques
Case study
Other valuation techniques
Relationship between size and price
Appointing advisors
Selecting a financial advisor
Appointing legal advisors
Preparing an information memorandum
Objective of an information memorandum
Identifying potential purchases
Identifying the optimal purchaser
Types of potential purchasers
Approaches potential purchases
Formal versus informal auction
Staggering approaches
Dealing with unsolicited offers
Contacting potential purchasers
Maintaining confidentiality
The negotiation process
Understanding the purchaser's objective
Releasing information
Bridging the price expectations gap- earn outs
Reviewing offers
Heads of greement
Rules for successful negotiation
The due diligence process and warranties
Types of diligence