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Selling your company--removing the obstacles to success: don't be bullied. Get full value out of your business.

Article Excerpt
[ILLUSTRATION OMITTED]

In more than 25 years of advising selling middle-market owners, I have seen many changes in the acquisition market. Many of these changes have negatively impacted a U.S. seller's ability to obtain a premium price. These include the consolidation of most industries, which has led to a reduction of potential acquirers, the globalization of business and the callousness and harshening of the U.S. corporate culture, amongst others. This article defines the many weapons available to a selling owner to overcome these and other obstacles. They are all tried and tested techniques, which I have used to force arrogant and obstinate acquirers to pay the premium prices and provide the protective deal terms my clients were entitled to. Knowing these techniques and how and when to use them will enable a selling owner to successfully sell their company despite the many obstacles that will confront them. In this way, a selling owner will reap the benefits they so justly deserve for their lifelong devotion to the operation of their company.

The first part of this article discusses the major obstacles faced by middle-market sellers in trying to obtain a premium-priced deal with strong protection in the representations and warranties, while the second part defines how those obstacles can be overcome. As a frame of reference, the middle market includes companies with a transaction price between $2 million to $250 million.

SELLER'S RESPONSES TO OVERCOME THESE OBSTACLES

The major overriding point a selling middle-market owner must understand is that any strategic acquirer who really wants their niche will eventually buy it at a premium price. However, the acquirer usually must be forced to pay this price, as they know that most sellers settle for inferior deal pricing. However the right strategic acquirer, if forced through the sophisticated execution of the acquisition process, will eventually...