This document discusses how to maximize the value of a company in a sales process. It outlines the typical sales timeline, including preparation, pre-sales decision making, valuation, non-binding bids, and closing. Key steps are hiring professionals, establishing realistic valuations, running a competitive bidding process, and being transparent with buyers. Maintaining knowledge of your company's value drivers and keeping emotions in check are also emphasized for obtaining the best price.
A summary of a key business valuation method, current EBITDA multiples, the drivers that influence the value of a business and how to increase the value of a business
We know you’re a genius. You’re building a phenomenal company, one that may change the world, but you never took or don’t remember what you learned in that Accounting Class.
Often entrepreneurs drown in paperwork and receipts as they try to flush our their business plan. It’s important to keep your books straight from the beginning and keep track of the most important thing: the money. In this hands on workshop, we will take you back to basics, covering the fundamental metrics and financial accounting principles that will make or break your startup.
Expert:
Dan Allred – Silicon Valley Bank
www.thecapitalnetwork.org
A summary of a key business valuation method, current EBITDA multiples, the drivers that influence the value of a business and how to increase the value of a business
We know you’re a genius. You’re building a phenomenal company, one that may change the world, but you never took or don’t remember what you learned in that Accounting Class.
Often entrepreneurs drown in paperwork and receipts as they try to flush our their business plan. It’s important to keep your books straight from the beginning and keep track of the most important thing: the money. In this hands on workshop, we will take you back to basics, covering the fundamental metrics and financial accounting principles that will make or break your startup.
Expert:
Dan Allred – Silicon Valley Bank
www.thecapitalnetwork.org
A great paper penned by my colleague Ian Smith that addresses common concerns of business owners with respect to a sale of their business. If you are currently considering your options, or have a client that is currently considering an exit, please feel free to reach out to us directly and we'd be happy to have a chat.
Selling your business for maximum valueRobert Dolan
For those without an exit plan, or given thought to what they can do in preparation to get the most value for their business when it is time to sell, this is a PowerPoint presentation for a seminar on the subject. This presentation will help you understand what is important and what to do to get prepared.
You never get a second chance at a first impression. Early-stage ventures seeking investment need to know how to target, locate, approach, and close with venture capitalists, angels, and strategic investors. Hear first-hand a successful pitch from an entrepreneur who has closed a funding round (or two) and how the company’s pitch evolved over time.
A practical overview of new FASB/IASB rules, who they effect, and guidelines for JD Edwards customers to follow to adopt these new rules. Presentation by Circular Edge's finance expert Yogesh Godbole.
McGladrey presentation at May 2012 AICPA CFO conference - FASB/IASB convergen...Brian Marshall
FASB/IASB Convergence Projects Update
Speakers: Brian H. Marshall, McGladrey LLP
Faye E. Miller, McGladrey LLP
The FASB and IASB are currently working together on a significant number of projects. This session will cover the status of these joint projects, with a particular focus on:
• Revenue Recognition
• Leasing
• Financial Instruments
This webinar focused on the ins and outs of purchasing a business. The objectives of this webinar were to provide the attendees with tips and tools to use as a buy side party in a transaction. More specifically, the participants came away with a basic knowledge of how to approach and communicate with targets, how to analyze a target, the due diligence process, and what to expect at close and post-closing of a transaction.
The presenters discussed the process from start to finish with a focus on the following areas:
- What do you want to be and where do you want to go? – First step is to identify the type of business that best fits your overall business plan and strategy (culture, size, business lines, etc.).
- Preliminary process – How to identify targets, use of professionals, development of a professional, and internal advisory team.
- Transaction process – Initial discussions, development of an LOI, transaction type, and due diligence.
- Closing process – Purchase document, delivery of assets or working capital, and final adjustments.
- Post-closing – Now What?
TCN on Air: Breaking Down Strategic Investments for Life Sciences and technol...The Capital Network
There are many routes to funding your life science startup. One way to get to the next step in the early stages is through strategic investments with industry partners. In this online interactive Google hangout, we will look at how a strategic investment differs from regular financial investments such as angels or VCs, and how this can both negatively and positively impact your company. It will also discuss who potential strategics are, their motivation, as well as the recent trends in strategic investment.
If you are looking for alternative routes to funding, this is the hangout for you!
Expert:
Ryan Sansom – Goodwin Procter
It goes without saying that business owners who want to sell their business within the next couple of years will have a few new factors to consider. Let here what you need to be thinking about and how to prepare.
Recently, James Darnell, partner at KLH Capital, gave a presentation to the Business Brokers of Florida. The aim of the presentation was to present actionable ways to unlock shareholder liquidity.
Plymouth - Essential 6-monthly Finance Directors' Update - November 2017PKF Francis Clark
Our six-monthly Finance Seminars provide an overview of the most important technical developments in financial reporting and taxation. The seminars address the key topical financial matters, the opportunities they present, how they affect your business and the pitfalls you can avoid.
Following the brief look at cyber security during our last round of events, our cyber team will be examining the issues we are finding in practice from the work we are doing with clients. We will also assess the impact of the upcoming GDPR legislation coming into force on 25 May 2018.
A great paper penned by my colleague Ian Smith that addresses common concerns of business owners with respect to a sale of their business. If you are currently considering your options, or have a client that is currently considering an exit, please feel free to reach out to us directly and we'd be happy to have a chat.
Selling your business for maximum valueRobert Dolan
For those without an exit plan, or given thought to what they can do in preparation to get the most value for their business when it is time to sell, this is a PowerPoint presentation for a seminar on the subject. This presentation will help you understand what is important and what to do to get prepared.
You never get a second chance at a first impression. Early-stage ventures seeking investment need to know how to target, locate, approach, and close with venture capitalists, angels, and strategic investors. Hear first-hand a successful pitch from an entrepreneur who has closed a funding round (or two) and how the company’s pitch evolved over time.
A practical overview of new FASB/IASB rules, who they effect, and guidelines for JD Edwards customers to follow to adopt these new rules. Presentation by Circular Edge's finance expert Yogesh Godbole.
McGladrey presentation at May 2012 AICPA CFO conference - FASB/IASB convergen...Brian Marshall
FASB/IASB Convergence Projects Update
Speakers: Brian H. Marshall, McGladrey LLP
Faye E. Miller, McGladrey LLP
The FASB and IASB are currently working together on a significant number of projects. This session will cover the status of these joint projects, with a particular focus on:
• Revenue Recognition
• Leasing
• Financial Instruments
This webinar focused on the ins and outs of purchasing a business. The objectives of this webinar were to provide the attendees with tips and tools to use as a buy side party in a transaction. More specifically, the participants came away with a basic knowledge of how to approach and communicate with targets, how to analyze a target, the due diligence process, and what to expect at close and post-closing of a transaction.
The presenters discussed the process from start to finish with a focus on the following areas:
- What do you want to be and where do you want to go? – First step is to identify the type of business that best fits your overall business plan and strategy (culture, size, business lines, etc.).
- Preliminary process – How to identify targets, use of professionals, development of a professional, and internal advisory team.
- Transaction process – Initial discussions, development of an LOI, transaction type, and due diligence.
- Closing process – Purchase document, delivery of assets or working capital, and final adjustments.
- Post-closing – Now What?
TCN on Air: Breaking Down Strategic Investments for Life Sciences and technol...The Capital Network
There are many routes to funding your life science startup. One way to get to the next step in the early stages is through strategic investments with industry partners. In this online interactive Google hangout, we will look at how a strategic investment differs from regular financial investments such as angels or VCs, and how this can both negatively and positively impact your company. It will also discuss who potential strategics are, their motivation, as well as the recent trends in strategic investment.
If you are looking for alternative routes to funding, this is the hangout for you!
Expert:
Ryan Sansom – Goodwin Procter
It goes without saying that business owners who want to sell their business within the next couple of years will have a few new factors to consider. Let here what you need to be thinking about and how to prepare.
Recently, James Darnell, partner at KLH Capital, gave a presentation to the Business Brokers of Florida. The aim of the presentation was to present actionable ways to unlock shareholder liquidity.
Plymouth - Essential 6-monthly Finance Directors' Update - November 2017PKF Francis Clark
Our six-monthly Finance Seminars provide an overview of the most important technical developments in financial reporting and taxation. The seminars address the key topical financial matters, the opportunities they present, how they affect your business and the pitfalls you can avoid.
Following the brief look at cyber security during our last round of events, our cyber team will be examining the issues we are finding in practice from the work we are doing with clients. We will also assess the impact of the upcoming GDPR legislation coming into force on 25 May 2018.
Designing Business Simulation Games using STELLA®, iThink® and isee NetSim™
Business simulation games and game-based learning provide many opportunities to engage business leaders, policymakers, stakeholders, and students in both learning and better decision-making. In this webinar, Ken Thompson of Bioteams Design will present simulation games and explain effective design techniques for publishing games to the web using isee NetSim™.
Gain an appreciation for how tools such as STELLA and iThink can be used to quickly build effective simulation games for learning and development. The webinar will start by providing context on the rapidly growing market for business simulation games, game-based learning, gamification, and informal learning. Examples of iThink business simulation games will then be presented. The webinar will conclude by covering the key aspects of STELLA/iThink which must be mastered to build simulation games.
Specific STELLA/iThink topics include:
Exploiting time-based graphical variables to automatically change the background game world
Using arrays to manage complexity and create agent-based dynamics in a game
Designing user interfaces for tablet and touchscreens, including sliders and on-off button combinations
Incorporating images to professionalize simulations and to allow multiple languages
Managing game parameters effectively with Excel
Leveraging the power of isee NetSim as a means to securely deploy simulations over the web
Market-based approaches to food safety and animal health interventions: Lesso...ILRI
Poster by Karl M. Rich, Huyen Nguyen-Thi-Thu, Ha Duong-Nam, Hung Pham-Van, Nga Nguyen-Thi-Duong, Fred Unger and Lucy Lapar at the Tropical Agriculture Conference 2015, Brisbane, Australia, 16-18 November 2015.
This slideshow covers how to go about a system selection process. Procurement of a system and managing vendors is a minefield for unsuspecting staff. This slideshow was created as part of a presentation to the ACCA Accounting professional body.
Dust Collecting: Panning for Competitive Intelligence Nuggets in Company Fina...Richter & Company LLC
Presentation by Brandon Conroy, Executive Consultant at Richter & Company, at the Association of Proposal Management Professionals (APMP) California Chapter Training Day November 6, 2015 in Anaheim, CA.
Start-up lecture by our Chief Investment Officer Darko Butina
Practical advice and first-hand experience on “How to sell your company”: The start-up lecture was presented by Darko Butina, our Chief Investment Officer.
Rob Jones, managing director of Peloton Partners, shares emerging pricing trends in the industry based on data from 70 advised firms across Australia, and strategies for advice practices to extract latent value out of their business.
InvoiceInterchange – Introduction to InvoiceTradingnalinee_c1
An overview of Invoice Trading - The process in which businesses sell their invoices at a discount to a network of investors to obtain immediate cash rather than waiting for invoices to be paid.
About InvoiceInterchange
- South East Asia’s first P2P invoice trading marketplace allowing businesses to selectively sell their outstanding invoices to raise flexible working capital
- We are here to help you with your cash flow needs
- SMEs sell invoices individually or in bundles
- Investors compete for your invoice
- advance SMEs cash at the most competitive price
Benefits of InvoiceTrading
Flexible - SMEs select the invoice you want to sell; single, some or all your invoices, when you want.
Contract - Sign up with no obligation; Pay-as-you-go
Transparent - Transparent: no on-going monthly service fees, no arrangement fees, no non-use fees
Control - SMEs set your maximum cost of finance. It can never be more, only less. Investors compete to fund your invoices, driving down the cost to you
Set up time - 48 hours set up time, cash within 24 hours
Confidentiality - Vendor will not be notified of the sales
Kenn Saddler, a B2B CFO partner, talks to 'The Alternative Board' about the importance of cash flow in operating a business. As Ken says, "It's all about the cash."
Calculate financial projections for investment presentationsThe Capital Network
www.TheCapitalNetwork.org
Join our experts in an overview discussion of financial projections. Learn the key metrics that will get investors to notice you, as well as those that will get you rejected. If you have no idea where to begin with your financial projections, this program is for you.
Experts -
Heather Onstott, Launch Capital
Heather Shanahan, Venture Advisors
This slide deck is from the webinar: Start with the Exit in Mind, presented by SecureDocs Virtual Data Room & TechStrat.
TechStrat Founder, Nat Burgess shares helpful, real-world advice on how tech companies can maximize M&A opportunities.
Similar to Optimizing the Value of Your Company (20)
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
how to sell pi coins in all Africa Countries.DOT TECH
Yes. You can sell your pi network for other cryptocurrencies like Bitcoin, usdt , Ethereum and other currencies And this is done easily with the help from a pi merchant.
What is a pi merchant ?
Since pi is not launched yet in any exchange. The only way you can sell right now is through merchants.
A verified Pi merchant is someone who buys pi network coins from miners and resell them to investors looking forward to hold massive quantities of pi coins before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
Exploring Abhay Bhutada’s Views After Poonawalla Fincorp’s Collaboration With...beulahfernandes8
The financial landscape in India has witnessed a significant development with the recent collaboration between Poonawalla Fincorp and IndusInd Bank.
The launch of the co-branded credit card, the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card, marks a major milestone for both entities.
This strategic move aims to redefine and elevate the banking experience for customers.
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
2. BITNET Presentation – January 10. 2012
Shaw Business
• Extensive Fibre footprint across
Canada with deep-fibre penetration
and coax distribution in Western
Canada
• Deep roots in the business segment
from Shaw “Big Pipe” and Shaw for
Business
• Have a suite of Business products
that address the needs of Small,
Medium, Large and Carrier
customers, including:
• Voice trunks/SIP trunks
• Hosted telephony
• Internet
• Ethernet LAN connectivity
2 • WiFi
3. BITNET Presentation – January 10. 2012
AGENDA
• How to maximize the value of your company
in a sales process:
• Typical Sales Process
• Pre-Sale Decision
• Valuation
• Preparation
• Process to maximize value
• Keys to successfully selling a company
3
4. BITNET Presentation – January 10. 2012
The Process and Timeline
Pre Sales Non-Binding Post
Preparation Bake-off Pre-closing
Decision Bids Closing
2 Months 1 Month 2 Months 2 Months
• This process and timeline would be typical of a business that is:
• $50M to $500M in value
• Non-public
• Moderate complexity
• Buyer and seller are motivated
• No regulatory requirements
4
5. BITNET Presentation – January 10. 2012
Pre-Sales
• Always be prepared:
• Keep a record of transactions in your industry
• Have a business plan that looks forward three years or
more
• Contracts and Legal Documents
• Have list of all contracts and their location
• Better yet - keep them in a single location or in a Database
• Avoid “consent for change of control clauses”
• Avoid a complicated ownership structure and any
restrictions on the sale
• Make the decision to sell at the right time
5
6. BITNET Presentation – January 10. 2012
Pre-Sales
• When is the right time to sell?:
• Depends heavily on the market, the company, the
owners,…
• To maximize value it would be perfect if:
• There are multiple motivated buyers
• You are the only seller
• Company has a strong opportunity to grow
• No recent, material changes (lawsuits, company structure,
ownership,……)
• No gun to your head
6
7. BITNET Presentation – January 10. 2012
Decision to Sell
• Hire Professional help
• Bankers/brokers
• Lawyers
• Accountants
• Negotiate a fee prior to start (avoid hourly charges)
• Make a list of the potential buyers and why they would
want to buy your company.
• Establishing value expectations and validate it.
• Discounted Cashflow
• Enterprise Value as a multiple of Earnings
(EV/EBITDA)
• Previous transactions (price per sub, price per $
revenue,…)
7 • SET A FLOOR VALUE AND STICK TO IT
8. BITNET Presentation – January 10. 2012
Valuation is key
Kazoo Enterprises
2010 2011 2012 2013 2014 2015 2016
Revenues $40.0 $44.0 $48.4 $53.2 $58.6 $64.4 $70.9
Expenses $28.0 $30.2 $32.7 $35.3 $38.1 $41.9 $46.1
EBITDA $12.0 $13.8 $15.7 $18.0 $20.5 $22.5 $24.8
Capital $5.0 $5.0 $5.0 $5.0 $5.0 $5.0 $5.0
Taxes (@20%) $2.4 $2.8 $3.1 $3.6 $4.1 $4.5 $5.0
Free Cashflow $4.6 $6.0 $7.6 $9.4 $11.4 $13.0 $14.8
i n $M
• Sample Company – Kazoo Enterprises
• Financials – 2 previous years, 3 year plan and two additional
years “extrapolated”.
• Private company
• Revenue growth 10% and Expense Growth of 8%
• $5M a year in capital upgrades to support growth
8
9. BITNET Presentation – January 10. 2012
Valuation – Discounted Cash Flow
2010 2011 2012 2013 2014 2015 2016 2017
Free Cashflow $4.6 $6.0 $7.6 $9.4 $11.4 $13.0 $14.8 $ Terminal Value
• What is the Dollar Value of the free cashflow generated by the
company?
• Future “cash” is discounted by a “discount rate”
• Terminal Value – value of the company if it were to be sold in the
terminal year
• In this example, we assume:
• Growth beyond 2016 = 2% and a Discount rate of 12%
• Terminal Value of $151M and Free Cashflow Value of the
Company = $122M
9
10. BITNET Presentation – January 10. 2012
Valuation – Discounted Cash Flow
• Watch-out for:
• Small changes in inputs can have huge swings in the result.
• Terminal growth of 4%, raises value by $25M
• Doesn’t work well in early stage companies or companies in high
growth and/or high risk environments.
• Buyers tend to discount the cashflows in the outer years (impacts
both cashflows and terminal value)
• Taxation rates may vary between the selling company and buying
company – which one should be used.
10
11. BITNET Presentation – January 10. 2012
Valuation – EBITDA multiples
• EBITDA = Earnings before Interest, Taxes, Depreciation and
Amortization.
• Enterprise Value = cash value of a company
• (Share Price x Number of Shares) + Debt - Cash
• Find as many Public companies in the same market and get an
average of the EV/EBITDA.
EV/EBITDA
Public Company A 7.2
Public Company B 6.6
Public Company C 8.1
Average 7.3
• An estimate of the of value is $13.8M x 7.3 = $101M
11
13. BITNET Presentation – January 10. 2012
Valuation- EBITDA multiples
• Watch for:
• Which EBITDA should be used:
• Trailing 12 months
• last quarter times 4
• Forward 12 months (in our example. $15.7M X 7.3 = $114.6M)
• Private companies tend to be more aggressive at expensing costs
versus capitalizing costs – which hurts your EBITDA
• Public companies tend to have a more diverse product suite –
therefore the comparisons may be apples to oranges
• Public markets have “expectations” built into the value of an
organization – so there will be variations in data points that are
hard to reconcile.
13
14. BITNET Presentation – January 10. 2012
Other issues with Valuations
• Synergies:
• How to you account for savings that occur post transaction
• Reduction in Management
• Volume discounting on materials
• …..
• Earn-outs
• Avoid them like the plague
• Payment options (get professional advice)
• Cash (tax implications)
• Stock (can allow you to defer capital gains tax)
• Mixture
14
15. BITNET Presentation – January 10. 2012
Preparation for the Sale
• Confidential Information Memorandum (CIM)
• Document that details the business, past results, future plans, synergies
with the buyer,…
• 50 to 100+ pages
• Information must be factual and truthful
• Teaser Document
• 2 page summary of the business
• Data Room
• Contains all of the documents required to evaluate the operation of a
company (financials, plans, contracts, suppliers and customer lists,….)
• Typically done electronically (documents all .pdf) and access to controlled
and reported on.
15
16. BITNET Presentation – January 10. 2012
Non-binding Bids
• Teaser document and Non-Disclosure/Non-Solicit
agreement sent to all potential bidders.
• CIM sent to all parties who sign the documents and
a “Non-binding” offer is requested.
• Typically top 3 or 4 “non-binding” offers proceed to
the next step.
• Things to watch:
• Employees will start to hear the rumours – so have a
communications plan
• Non-solicit must have a “no collusion” clause
• Non-binding bids should contain information with regards
to how the buying company intends to “fund the deal”
16
17. BITNET Presentation – January 10. 2012
The Bake-off
• The final 3 or 4 buyers attend a management
meeting:
• Questions on the CIM are answered and more
information provided.
• Access to the Data Room is provided and due
diligence questions answered
• Two weeks later, Binding offers are requested
• An auction like process is typically followed – those
who bid too low are given a chance to improve their
offer.
• It is not just the money – the Definitive
Agreement is a key part of the decision.
• PICK YOUR WINNER
17
18. BITNET Presentation – January 10. 2012
Definitive Agreement
• Why it is important to be part of the final decision
• Number of Items can effectively lower the value paid, such as:
• Representations and Warranties
– Timing and logistics of breaches
– Capped versus uncapped
• Hold-backs and Escrow amounts
– Size and timing
• Should contain a “break clause”
• Hard to re-engage other parties once the decision is made
• Contains the items that need to be satisfied prior to closing and the
timing. The faster you close the better:
• Reduces employee uncertainty
• A quick closing keeps your ability to revert to the runner up open.
• You are effectively in a situation where you have two owners
18
19. BITNET Presentation – January 10. 2012
The Key’s to maximum value
• Be committed to the sale – set a price and drive to completion.
• Bring in professional help – the money paid will most certainly
be less than the value added.
• Run a competitive process – horses run faster when there are
other horses in the race.
• Knowledge is a key driver
• The better you can articulate the value drivers, the better price you will
get
• Be honest – as you will be expected to represent and warrant
your statements
• Keep calm
• emotions can be destructive in a sales process
19
20. PRESENTATION NAME January-11-12
THANK YOU
John Piercy
Group Vice-President, Shaw Business
john.piercy@sjrb.ca
20