Selling businessES
Make it Count
Selling your business can be a life-changing moment. It is commonly the pinnacle of your professional career and is exciting, challenging, and often stressful. However, only a small percentage of business owners actually achieve a sale. To be successful, your exit needs to be carefully planned and expertly executed. Our sell-side advisory services can help you sell your business when you're ready to exit.
Helping you sell your business
Introduction to OUR 'SELL-SIDE' ADVISORY SERVICES
WHAT IS BUSINESS FINANCING?
Business financing is sought for the specific purpose of funding business activities which can include acquiring another business, management buy-ins (MBIs) or buyouts (MBOs), a key growth project or investing in new talent. Business financing can help you achieve your growth objectives and strengthen your overall competitive advantage. But the process to secure the business funding you need can be time consuming, stressful and costly if you don’t know what you’re doing.
HOW MUCH BUSINESS FUNDING CAN YOU SECURE?
We work with ambitious, high-growing businesses that have funding needs in excess of £2m and regularly approaching £100m. Our clients’ needs will typically be for sophisticated finance products such as cash flow based lending or private equity investments. Our value lies in helping clients access funding that relies on confidence in future trading and cash flows.
See our deals and success stories.
BUSINESS FINANCING – COMMON PITFALLS TO AVOID
We can confidently say that every client we engage is unprepared to take their funding proposal to their business bank or alternative lender. Being unprepared for funder scrutiny can significantly reduce, or entirely remove, your chances of getting the financing your business needs. Remember: first impressions count.
The typical things that can erode funder confidence and jeopardise your chances of securing a business loan include:
- Failure to fully explain your business model;
- Poor articulation of your value proposition and value drivers;
- Inconsistent, incoherent or incomplete financial information;
- Weak financial modelling and incomplete forecasts;
- Presenting a biased view of business performance and risks;
- Funding proposals that exclude critical information that lenders expect to see.
BUSINESS FINANCING – HOW TO DO IT RIGHT
To successfully secure business funding, whether it’s for supporting an acquisition, a management buyout (MBO) or organic growth, you need to achieve four fundamental objectives:
- Create a robust business plan that stands up to funder scrutiny;
- Articulate that plan in a balanced and coherent way that funders can understand;
- Approach the right partners to fund your plan as part of a competitive process;
- Defend value in due diligence and close your transaction professionally.
Funders need to have confidence in you and your business from the beginning to the end of the financing process. In the world of funding first impressions matter and you must never approach the funding market until you are truly ready. We can help you get ‘market-ready’ to deliver funder confidence and secure the funding you need to make your ambitions happen.
BUSINESS FINANCING ADVISORY SERVICES
By using our business funding advisory services, our experts will ensure that your funding proposal stands up to funder scrutiny and gives you the best chance of securing the funding you need. Below are the different types of business financing we can help you secure:
SELLING YOUR COMPANY
It's no surprise that the process of selling your company can get pushed back. This is because selling your business is likely to be the biggest commercial transaction of your life. It is also one of the most significant decisions for you and your family to make. There's just never enough time to think about your exit strategy, sale price, potential buyers and when to sell.
It’s also important to realise that selling your company is no trivial affair. If you’re not ready to sell, or if you don’t approach the sale process or business buyers in the right way, you can leave a lot of value on the table. Or worse still, the potential deal can fail completely!
WHO DO WE WORK WITH?
We work with owners of UK based privately-owned SMEs worth £10m or more that are ready to sell all, or part, of their business. We help our clients with the sale of a business via trade sales, private equity sales, management buyouts (MBO) or employee ownership trusts (EOT).
See our deals and success stories.
HOW TO SELL A BUSINESS - COMMON PITFALLS TO AVOID
When selling a business the sale process will be stressful, time consuming and fraught with risk. Being unprepared for the sale process could mean that you fail to achieve its real value, sell to the wrong buyer, fail to get a good deal or fail to sell at all. Each can erode the value of your business and jeopardise any legacy you wish to maintain once it's been sold.
Here are some common mistakes that owner-managers make when placing their business for sale:
- Failing to plan an exit assuming that it will ‘just happen';
- Limited appreciation for the time commitment and dedication it takes to achieve a sale;
- Expecting buyers to approach them, rather than actively taking the business to market;
- Holding unrealistic valuation expectations and limited understanding of typical deal terms;
- Failing to bring about ‘competitive tension’ amongst potential buyers;
- Poor understanding and articulation of the businesses value proposition, its ‘value drags and value drivers’;
- Failure to develop a sufficiently strong management team to get them away from ‘day-to-day operations’;
- Lack of preparation for due diligence or generally untidy business practices;
- Inability to stay three or four moves ahead of the process due to lack of experience;
- Poor communication to stakeholders post-deal.
HOW TO SELL YOUR BUSINESS IN THE RIGHT WAY
Whatever sale route you choose, the steps to selling your business need to achieve these key objectives:
- Set out your business exit criteria, thinking carefully about your required net returns and the legacy you wish to establish with employees, customers and other key stakeholders;
- Undertake a critical review of your business and identify the ‘value drags and value drivers’. You must develop a plan to mitigate drags and enhance drivers;
- Carefully decide on the best business sale option for you and your business;
- Thoroughly prepare for the due diligence process covering all aspects of legal, financial and commercial so you are ready to respond to enquires promptly.
- Take a structured approach to find a buyer(s) – which may include your existing management team – and work towards developing and positioning your business in a way that delivers best value to them;
- Run a structured sales process to your timetable that brings prospective buyers to the table at the same time to create competitive tension;
- Skilfully negotiate the deal structure, purchase agreement and complex terms that surround a business sale to maximise value and minimise future risk;
- Maintain professionalism in all interactions to deliver the conversations that build trust with identified buyers;
- Build an internal and external communications plan to protect value and satisfy the needs of all stakeholders.
SELL-SIDE ADVISORY SERVICES
When you're ready to sell your business, our 'sell-side' specialists will ensure that you have the right exit strategy, secure the best price, find the right buyers, design an efficient selling process and mitigate associated risks. Here's how we can help you achieve a successful company sale:
EXIT PLANNING
Our ‘sell-side’ experts advise on the development of your exit strategy. Building your strategy well before it is time to exit will unlock maximum value when it’s time to sell your business.
Learn more
BUSINESS VALUATION
Our ‘sell-side’ specialists will leverage extensive knowledge to provide an independent valuation of the business you wish to sell. This real world, fact-based, professional valuation will allow you to choose your exit timing and plan and your post-deal finances.
Learn more
BUSINESS SALES
Our experts can advise on the best route to achieve your business sale whether a trade sale, management buyout, employee ownership trust or a multi-track approach is best for you.
Learn more
BUSINESS SALE TAX PLANNING
Tax is an essential element to get right when thinking about your net returns from a business sale. We can help build a tax strategy so your tax affairs, and tax returns, are in the right shape so you can maximise the value from selling your business.
Learn moreADDITIONAL BENEFITS OF USING SHAW & CO
Showing you how
Selling a business is a complex process and any buyer will need confidence in your readiness to sell. We use our experience to establish buyer confidence and nurture their motivation to buy.
Independent evaluation
It is often easy to get caught in ‘deal fever’ and sell when you shouldn't. Our independent point of view helps keep decisions logical rather than emotional. We are there to support you with those difficult decisions.
Added connectivity
Leverage our networks and connectivity to get access to buyers that are unknown to you. Use our deal credentials to generate buyer interest to make your trade sale happen.
FAQS
Corporate finance transactions are not an everyday activity and it is unlikely your team will have the skills and knowledge required to navigate a deal. We provide expert advice to ensure a successful outcome.
We are experts in selling mid-market owner-managed businesses and have managed sale processes on behalf of clients that have involved some of the world's largest buyers (such as Unilever), as well as much more modest companies, through to private equity and everything in between. We ensure that your business is fully prepared for the transaction and maximise its value by positioning the business with buyers in the best possible way. Our experience ensures that you aware of what is coming next so that you can stay several steps ahead of negotiations. Selling a business is the largest transaction of many business owners' lives. It is not the time to ’learn on the job‘ but the time to ensure that you have the absolute best experts alongside you.
We work with businesses looking to sell that have a value of more than £10m. We may agree to work with slightly smaller businesses in circumstances where a buyer has already been approached and the mandate falls short of a full marketing process. There is no theoretical maximum value of the businesses that we work with. Recent sales values have approached £100m and our median deal value is between £20m and £30m.
No, we are not brokers. We are professional advisors. Whilst our role often involves the introduction of parties to a deal, our value is much greater than a simple introduction service. We support you in the development and articulation of your business case, the negotiation of terms and the management of completion - all of which materially improve the end result, adding significant value to your transaction.
Our fees are predominantly ’Success Fees‘, meaning that we get paid on completion of the deal. We take great care to make sure our fees are aligned with your goals and we take pride in our fees always being a proportion of the value we add. A smaller proportion of our fee is structured as a ’Commitment Fee‘ which is paid monthly whilst we are working on your sale.
The process of preparing a business for exit, marketing the opportunity and completing a deal, take an average of around nine months. However, this all depends on the readiness of the business and the value aspirations of the owners. We have worked with business owners for several years before an exit is formally started to align business value and personal financial aspirations.
Yes, we have completed cross-border transactions on numerous occasions. We are fully capable of accessing international buyers and investors looking for opportunities in the UK. However, all our clients are UK based entities.
We have specific sector knowledge derived from many years of collective deal making experience. However, we pride ourselves on the diversity of sectors we work with which challenges us to think creatively. This creative and challenging approach brings huge value to our clients when helping them to build robust business cases. See some of our specific sector experience.
Certainly not! Our aim is to become part of your extended team keeping you up to date with all developments. All decisions are yours to make. Our aim is to make those decisions easier.
We take all of our clients through a carefully crafted journey. This not only ensures that we are a great match for each other but, once engaged, it helps us to deliver exceptional client service that exceeds expectations.
We put you first
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We are immensely proud of all that we have achieved at Torchlight. We look forward to this new chapter with such credible and ambitious partners, who share our desire to bring enduring security and stability where it is needed most in the world. I’d also like to add my personal thanks to Shaw & Co for making the deal happen."
Managing Director, Torchlight Group
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November 6, 2024
