In Deal Note® 133, we introduced a critical document in the sale process: the Teaser. This is traditionally a one-page report summarizing a business for sale but does not include specific details that would inform the buyer of the exact company. The Teaser should be an “elevator pitch” document that either piques the interest of a potential buyer or efficiently confirms that the potential buyer would not be interested in the opportunity. In this Deal Note®, we will cover what should be present accompanying a Teaser to maximize the efficiency of the solicitation process.

There are two vital considerations that should accompany the Teaser: 

  1. Existing relationships – it is important to identify the buying community that would be a great potential acquirer of a business, but it is crucial for your M&A banker to have existing relationships in the buying community. Potential buyers can be slow-moving and even slower to unknown sources of acquisition opportunities. By your M&A banker having an existing relationship with the individuals on the potential buyers list, you can broaden the interest in the selling business and formulate a more competitive sale process, increasing the seller’s negotiating position.
  2. Having the right point of contact – the most senior contact is not always the optimal point of contact for an acquisition opportunity. For example, many strategic companies usually have the quickest turn time on an opportunity review when going to the right corporate development individual. Knowing the structure of each buyer’s company is vital to getting your business in front of the key decision-making personnel promptly.

It is best to treat each buyer on a case-by-case basis based on your M&A banker’s knowledge of the potential buyer’s business structure, size, and type. The prevalence of strong relationships within the buying community specific to your business is vital for value maximization, efficiency of decision making, and improving your negotiating position.

Have a great day everyone,

Ryan Kirby
Junior Partner