20 years in the M&A business: 20 questions to ask a potential M&A advisor
To celebrate our two decades of collective experiences and learnings, our Australian partners share the questions they are frequently asked.
The sales process is one of the most important in a company’s lifecycle, so choosing the right advisor and asking the right questions is imperative to achieving success. An advisor’s role is to take the stress out of an engagement for the client, and it is this understanding that underpins Clairfield’s ethos of achieving more for its clients.
Clairfield in Australia’s non-executive director Paul Keehan and associate director Michael Kakanis, along with Clairfielders around the globe, have compiled the 20 essential questions every company leader should ask before embarking on an M&A journey.
Experience of the firm and its people
1. What experience do you have selling businesses with similar characteristics to mine or of a similar size? What deals have you closed (not just worked on) in the past three years?
2. Who will lead, and who will be working on my assignment? Are the people I am meeting the ones who will be doing the work?
3. Do the people working on my deal understand my sector, my business and its key drivers? Have they ever worked in a “real” business, not just advised?
Access to investors
4. What contacts do you have among potential buyers? Do you have appropriate access to both industry and financial buyers? Can you discuss your process for developing a potential buyer list?
5. Who were the buyers in past transactions you closed, and how did you find those buyers?
6. Do you have a genuine international partnership to secure overseas buyers? Can you share recent examples of how this has worked in practice?
Approach to the transaction
7. What will you be practically doing for me? What is your sale process and the deliverables?
8. What are the specific factors about my company that will enable me to achieve a premium price for the business? How will you increase value and improve the terms of a transaction?
9. How would you market my company? Can you show me some previously created deal material?
10. What steps do you take to ensure the confidentiality of the business sale process and to protect my staff from being poached by potential buyers of the business?
11, What other assignments are you working on, and do you have sufficient resources for my sale process?
12. How much time will the process take?
13. How will you keep me informed about the process? What involvement will I have, and what input do you expect from me?
Ethics and values of the firm and its people
14. When I meet with the advisor, is it clear they are listening to my goals and concerns and care about the outcome (not just their fee agreement)? Are they focused on delivering outcomes or just describing the process?
15. What would your prior clients say about you? Are you happy for me to speak to your previous clients?
16. How important will I be to you? Will you be focused on my transaction, or am I just one of many? Is a transaction of this size and type the right fit for your firm?
17. Would you have any conflicts of interest if appointed?
18. What fees are involved, and what do they cover? Does the fee agreement align with our interests?
19. How do you behave when things go wrong in the process?
20. How can I be sure you have my back and are focused on getting me the best outcome possible?
A transaction is a very involved process and picking the right advisor can help alleviate some of the pain during the sale process and even make it an enjoyable experience.