I can negotiate in my sleep these days, but for someone who is just getting their feet wet, negotiating acquisitions can be a complex and sometimes overwhelming process.
If you’re just getting started, here is one piece of advice you can implement to ensure that you’re being thorough in your negotiations.
Understand the legal implications, financial considerations, and potential risks associated with any business purchase or sale.
Financial Considerations
Understand the company’s current financial position and evaluate any risks associated with investing in or buying the business.
Legal Implications
Consult an experienced lawyer with specialized experience in mergers and acquisitions to help identify potential issues and establish an effective strategy for negotiating the deal. If you’re newer to acquisitions, this is your safety net.
Potential Risks
When due diligence is properly done, you’ll be able to uncover the answers to these inquiries and establish clarity and peace of mind in moving forward with acquiring the business.
Both parties should have the opportunity to fully understand the terms of the agreement – this includes payment structure and conditions related to price adjustments or other contingencies.
Negotiating and Closing a Business Acquisition Deal
By taking the time to thoroughly evaluate all aspects of any proposed deal, it is possible to ensure that both parties are in agreement on the terms and conditions of the transaction. This helps to minimize risks while maximizing the deal’s value.
As you get a few deals under your belt you’ll begin to see how negotiating is more a process of determining and honoring the true value of a business so that both the buyer and seller walk away satisfied and wealthier over the long term, not a tug of war match over some short-sighted dollars.
