Merger & Acquisition

Use capable, experienced, and objective assistance when initiating or responding to business sale and acquisition opportunities.

Acquisition

Rice & Associates works with either proactive or reactive acquisition engagements. In a proactive acquisition, Rice & Associates:

Helps clarify the acquisition criteria
Targets, contacts, discerns interest, & clarifies expectations of sellers – and begins to gain sellers confidence, trust, & respect
Handles confidentiality matters
Requests and handles correspondence
Evaluates the acquisition, and reviews for certain concerns & opportunities – like assimilation, synergistic fit, or cost reduction
Performs a fair market business valuation that’s able to be explained & defended

Prices the offer, or reviews & credibly responds to seller’s pricing
Negotiates the deal
Bridges significant differences in deal gaps through listening, finding solutions, and use of risk/reward contingency pricing
Summarizes key components of the deal – see Term Sheet under Business Sale for typical key components
Interacts with your due diligence team
Works with your attorney to bring the acquisition to a successful close

A reactive acquisition process is similar to proactive, except for certain criteria, targeting, and evaluating activities.

Rice & Associates helps screen out or pass on deals that shouldn’t be made.

Not as glamorous, but many times the best deal is the one not made.

View Select M&A Transactions

Contact Rice & Assoc for book purchase information

Business Sale

Rice & Associates represents a sound choice to assist you in executing a business sale exit strategy. As part of its merger & acquisition advisory role, Rice & Associates works upfront with you to determine viable options and timing. Rice & Associates works with either proactive or reactive/limited sale engagements. A proactive sales process includes:

Prep for Sale and Information

Addresses timing, management, performance, audit, and financial considerations
Gathers and assimilates information

Valuation/Pricing

Performs a fair market business valuation, principally utilizing free cash flows (EBITDA) income approach
Does credible recasting, and looks at deal from both seller and buyer perspective – to get done, deal has to work for both parties
Builds a case for “expected” earnings/EBITDA
Understands value drivers
Generates competitive buyers and options

Targeting

Targets (rifle approach), contacts, discerns interest, & positions the expectations of qualified strategic or Rice & Associates network of financial buyers
Utilizes CDA for upfront confidentiality protection

Confidential Sale Memorandum (CSM)

Prepares professional company profile or less formal, where called for, marketing package to limited, interested targets – CSM typically includes company overview; expectations; transaction reasons & objectives; major assets for sale, including highlighting and selling intangibles; marketplace discussion; people; financials; and buyer’s opportunity

Negotiations & Term Sheet

Negotiates & sells the deal
Able to articulate & defend valuation, and bridges real differences in expectations
Drives the deal terms – typically includes pricing, transaction structure, terms, people/employment, allocation, lease, non-compete, timing, working capital “stake-in-the-ground”, minority interests, third party handling, contingencies, indemnification provisions & other major reps, and other key components to the transaction
Monitors buyer’s due diligence
Gets parties through the deal’s rough spots

Purchase Agreement

Coordinates and works with your attorney to see the deal sticks to intent, and gets documented through to a successful conclusion

A reactive sales process is similar to proactive, except for certain information, targeting, and CSM activities

In Brad’s book, Buy, Sell, or Grow – it’s all about Value!, keys to increasing multiple are:

Earnings – high absolute, EBITDA and gross margins
Size – revenues, growth, trajectory
Revenue base – recurring or long-term contractual
Scalable
Brand – proprietary, strategy, differentiator, advantage
Stable – diversified, non-cyclical, consistent
Business model – defined, effective, simple; disruptive?
Management team – and succession
Culture/people
Relationships – customers and others
Technology
Clean – example, timely and accurate financials
Eventual exit for buyer – path, certainty, success