Selling your Business or a division of your Business – The Process.
AIM’s primary activity is to arrange the sale of a company or a division of a company. We begin by assisting our clients in determining an estimate of the company’s market value and in deciding whether selling the business is desirable and feasible. If a sale appears appropriate, we advise our clients on timing, strategies for optimizing shareholder return and the preferred transaction structure.
Initially, we prepare a Confidential Information Memorandum (which describes the business in detail). Included in the CIM is a description of the operations, the industry, management, ownership, financial statement review and analysis and the reason for sale. This gives prospective buyers an in depth understanding of the business so best to position the company for the target market.
Simultaneously, we work together with our clients to identify the prospective purchasers who will place the greatest value on the company being sold. We work to find the best purchaser for the business whether it be a strategic company who is directly connected to the vendor’s industry or a private equity firm who has extensive knowledge of the industry and is supported by large pools of capital. Once such a list is prepared and approved, we then confidentially approach potential buyers.
If prospects are interested after an anonymous introduction, AIM has them sign a confidentiality agreement and the CIM is sent to them. A major role for AIM as financial intermediary is to assist in negotiations, acting as a screen between parties in order to minimize the inevitable contentious issues that arise. This is especially important when transactions involve potential future partners (in the case of a partial buyout or earn-out situation) where you will have to work with the parties for a period of time going forward or where there will be some payment due over time.
Perhaps most importantly, we allow management to continue to concentrate their efforts on managing the business and maintaining the share value while all the above noted work is being undertaken. Finally, we coordinate the accounting, legal and business due diligence, assist with the preparation and review of legal documentation and, in general, manage the process of completing a transaction.