A qualified Mergers & Acquisitions (M&A) advisor can often be well worth the cost by delivering improved transaction terms and helping you get the deal done.

Selling your business is likely to be a transformational, once-in-a-lifetime event. Many business owners grapple with the decision of whether to hire an investment banking firm to advise them on a potential sale transaction. Some choose to “go it alone” and are successful but may never know if they got the best deal. Others never get to a closing and are left with nothing to show for a lot of wasted time and effort. Here are some of the top reasons you should consider working with an advisor.

You Should Know Where You Stand

Do you know what your business is worth and whether now is a good time to sell? Business value is a function of not just your company’s performance, but also what’s happening in your industry, the macroeconomy, and capital markets. An advisor can assess current market conditions, develop valuation expectations, and perform a “scorecard” analysis on a company to identify the key determinants of value.

Competition Is Critical

Buyers are naturally unwilling to pay more than they must for something. Generating a competitive dynamic in a business sale can uncover the true value of your company. An organized and well-run process signals to potential buyers that they need to be aggressive to prevail. An experienced M&A advisor can orchestrate a process that creates competitive tension. Even if you already have a buyer that you like at the table, the threat of opening the process to potential other bidders can keep that buyer honest.

The Obvious Buyer Often Isn’t the Best Buyer

You know your industry well and probably have an opinion on who should buy your business. You may have even been approached by a competitor, customer, or supplier about selling but likely do not have the time and resources to identify and contact the full universe of potential buyers. Seasoned M&A advisors are in constant contact with active buyers of businesses and can uncover additional potential buyers that you may not have been aware of. This expertise paired with an orchestrated marketing process provides the peace of mind that you’ve fully explored your company’s value in the market.

An Advisor Fills an Important Role on Your Team

You may be tempted to rely on your trusted attorney or accountant to get the deal done without an investment banker. Despite how capable they are, your attorney and accountant may not have the market knowledge and process expertise that an M&A advisor provides. We take an active role in negotiating the price and terms of the transaction, with critical market awareness and an understanding of buyer strategies and objectives. Furthermore, we spend a lot of time determining how best to position the financial results of the business to maximize value in the eyes of the buyer.

Getting to the Finish Line Is a Lot of Work

It seems like it should be pretty simple, right? You agree on a price with a buyer and then your attorney helps you document a transaction. The reality is usually very different. A buyer’s due diligence investigation will often include teams of accountants, attorneys, and consultants, each with their own list of questions and information requests. You and your management team have a business to run and may not have the bandwidth to handle this onslaught. Part of our role in a transaction is to organize your information and act as the quarterback for the buyer’s due diligence work.

The Benefits Often Far Outweigh the Cost

Taken together, the prior points can result in a greater likelihood of reaching a successful transaction through a competitive process that drives a higher price and better terms. The value an advisor can bring to a transaction often far exceeds the fee they charge. Furthermore, the bulk of our compensation is typically contingent on a closed transaction, so we have every incentive to achieve your definition of success.

If you’re contemplating a potential sale of your business, there are many reasons you should consider having a qualified M&A advisor on your side of the table. Our team represents sellers of businesses every day and our decades of collective experience in managing the sale process puts us in position to guide business owners at every step of the way. Please contact us for a discussion about ways we may be able to assist you.

About Janney’s Corporate Advisory Group

Janney’s Corporate Advisory Group is a dedicated team of investment bankers serving public, private, and sponsor-backed businesses. The focused practice spans four active middle-market segments: Healthcare, Business Services, Diversified Industrials, and Consumer. We have extensive middle market and private company transaction experience and understand the nuances of these businesses. We work with clients on a highly personalized basis, providing exceptional service, commitment, and senior level attention.

Working With Janney

Depending on your financial needs and personal preferences, you may opt to engage in a brokerage relationship, an advisory relationship or a combination of both. Each time you open an account, we will make recommendations on which type of relationship is in your best interest based on the information you provide when you complete or update your client profile.

When you engage in an advisory relationship, you will pay an asset-based fee which encompasses, among other things, a defined investment strategy, ongoing monitoring, and performance reporting. Your Financial Advisor will serve in a fiduciary capacity for your advisory accounts.

For more information about Janney, please see Janney’s Relationship Summary (Form CRS) on www.janney.com/crs which details all material facts about the scope and terms of our relationship with you and any potential conflicts of interest.

By establishing a relationship with us, we can build a tailored financial plan and make recommendations about solutions that are aligned with your best interest and unique needs, goals, and preferences.

Contact us today to discuss how we can put a plan in place designed to help you reach your financial goals.

Janney Montgomery Scott LLC, its affiliates, and its employees are not in the business of providing tax, regulatory, accounting, or legal advice. These materials and any tax-related statements are not intended or written to be used, and cannot be used or relied upon, by any taxpayer for the purpose of avoiding tax penalties. Any such taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

For more information about Janney, please see Janney’s Relationship Summary (Form CRS) on www.janney.com/crs which details all material facts about the scope and terms of our relationship with you and any potential conflicts of interest.

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