An M&A deal is the biggest deal of your life, so completing a successful transaction is key. Knowing a few key M&A tips — whether you're merging or acquiring — increases your odds of successfully completing an M&A deal. Secrets to success include the following:
Retain capable and experienced M&A advisors. You can't complete this transaction alone, and a business owner who represents himself in a life-altering deal is asking for trouble. You need a dispassionate advisor, someone who has been through the process before and can guide you to a close. This advice is especially true if you're selling a business.
Don't allow yourself to get too high or too low during the process. M&A is a roller coaster ride, with ups and downs around every turn as a deal you think is wrapped up one day falls apart the next day . . . only to come back together on the third day. You have to be able to keep an even keel.
Check emotion at the door. Despite the frustrations of M&A, you need to keep your emotions in check. Yelling and screaming don't get the deal done. Logic, facts, and a cool demeanor do.
Don't jump at the first offer. Ideally, you want to have multiple offers before deciding which deal to accept. Having options increases your chances of getting a great deal.
Don't hold out for a marginally better offer. If you want to do a deal and the offer is sufficient, take it. Part of something is better than all of nothing, which may be what you get if you wait around for the perfect deal that never comes.
Know when your position is weak or strong. Overplaying a strong hand can chase off otherwise suitable deals; misplaying a weak hand can scuttle the deal and perhaps your career!
The market is the best way to determine your company's valuation. In other words, business appraisal services have limited value. Get out in the market and have actual conversations with actual Buyers.
