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Exit Planning

We have discussed the importance of early exit planning for the sale of your company in earlier Deal Notes®, specifically Long-Range Sales Preparation (August 9, 2022), Sale Preparation (May 2, 2023), and Deal Team Professionals (July 11, 2023). This Deal Note® is designed to help you, as a business owner, to put some specificity into events and their timing because we continue to see business owners who should have planned earlier resulting in unfortunate delays and less optimal results.

Clearly, Exit Planning begins with you, as the business owner, having largely personal and professional conversations with trusted family and advisors (e.g., estate and tax planning, wealth planning, family agreement) 3 – 5 years in advance of a sale to implement optimal tax and estate plans.

Three years before the intended sale, ensure that your financial results will meet rigorous buyer analysis either through providing reviewed, or ideally, audited financial statements.

Two years before the intended sale, put in place the professional team that you will need to ensure a smooth sale process. Typically, the team will include experienced M&A attorneys, accountants, tax advisors, and your M&A investment banker.

A year before the intended sale, commence the sale process. The process starts with exhaustive due diligence led by the M&A banker and meticulous production of your Confidential Information Memorandum (CIM), for distribution to potential buyers.

While there is some variability in all these timelines, the primary objective is to begin early to ensure the best preparation for the sale of your company.

Have a great day everyone.

Bruce Andrews
Managing Director, Defense