Mergers & Acquisitions Advisory

A Neumann & Associates, LLC

February 10, 2015

Be Proactive to Maximize Value

By Joseph Eneldas

value-min

Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.   — Sun Tzu

Selling a company is a monumental job – one that most business owners expect (and hope) to do only once in their lives.  After all, the company is generally the most significant asset for owners of small to mid-sized businesses, and with so much riding on the outcome, the owner better get it right.  And getting it right hinges on planning and preparation.

Without adequate planning and preparation, the owner will inevitably pursue a passive approach to selling a company, and we have all heard the horror stories that result.  The business isn’t ready to sell – there are major policy, operations, and financial issues that have not been addressed.  The books and records are a mess.  Nothing has been done to identify the true market value of the business.  The alleged buyer strings along the seller for as long as possible and many times the deal falls apart after months – or years – of negotiating.

“We look to begin work with business owners early on, to develop proactive strategies that offer greater control and maximize the outcome,” says Achim Neumann, President and CEO of A Neumann & Associates, a mergers and acquisitions firm in NY, CT, NJ, PA, MD, DE.  “With the proper guidance, business owners can schedule, plan, and engineer a successful exit to suit their unique requirements.”

A proactive exit strategy can be powerful and effective.  It allows a business owner to obtain a higher cash yield from the sale, as well as to maintain leverage and control of the process and negotiations.  With a proactive strategy, the business seller, not the business buyer, sets the pace and drives the process forward.

The advantages of starting early are significant:

First, time is available to realign organizational objectives and prepare the company for acquisition, thereby enhancing it as an investment opportunity.  “Time to plan, prepare, and create maximizes the value of the business,” says Neumann.  “The differences can be dramatic.”

In addition, leverage, control and credibility are more easily preserved on the sell side of the table when there is a good plan in place.  A lack of planning or running out of time concedes leverage and control of the sale to the prospective buyer.

Furthermore, specific requirements for the deal structure, tax considerations, or specific terms and contingencies can get addressed far in advance.  “The ultimate objective is to maximize the net cash from of a business sale.  Planning for these deal-specific elements is necessary to maximize after tax proceeds,” says Frank Arcoleo, Managing Director for Central Pennsylvania.  “Finding out about these issues and trying to address them deep in the negotiation process could undermine the deal.”

With adequate time and planning, there is an opportunity to discover and address issues large and small.  Business Sellers have time to develop appropriate message points to address potential buyer concerns and to present them in the marketing package.  Without proactive attention, key issues can slip by unnoticed, and this can potentially deteriorate the perceived value of the company when they surface during negotiations.

Design and plan a successful exit first, and then sell the company, and you’ll never go wrong.

About A Neumann & Associates, LLC

A Neumann & Associates, LLC is a professional mergers & acquisitions and business brokerage firm having assisted business owners and buyers in the business valuation and business transfer process through its affiliations for the past 30 years. With an A+ Better Business Bureau rating, the company has senior trusted professionals with a deep knowledge based in multiple field offices along the East Coast and has performed hundreds of business valuations in its history. The firm’s competitive transaction fees are based on successfully completing transactions. For more information, please contact A Neumann & Associates at 732-872-6777 or info@neumannassociates.com

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Client Testimonials

“Working with Marc and his company was a pleasure. What I thought was going to be a just another one of those pushy sales companies was just the opposite. Polite, knowledgeable, and a pleasure to talk to and deal with. Marc handled most of the interaction and he has one of the greatest demeanors. Again, it was a pleasure working with him and his firm.”

Douglas DiCeglio

“I recently completed an acquisition using A Neumann & Associates. Tony Valentino was very helpful and accessible during the entire process. They do a thorough job vetting both parties and got us to the finish line.”

Srini Mudambi

“Claus out of Florida helped us with the sale of our business. We had never done anything like this and him and his team walked us through the process from start to finish. We had some challenges through the process and Claus continued to show up even in the difficult conversations.”

Colby Harris, Co-Owner, Del Mar Designs

“Claus Madsen thoroughly helped us with selling our company. From the 1st introductory meeting explaining to us what was possible, to providing us with resources to assist with the sale. Claus was invaluable throughout the whole sales process. Claus was with us every step of the journey and always made himself available for any questions or issues that came up along the way. If you are interested in selling your business, I encourage you to reach out to Claus and the ANA team so that they can let you know what’s achievable. These guys will make it happen!”

Ron Harris, Co-Owner and Vice President, Del Mar Designs

“A Neumann & Associates is the only business broker I would use or consult with. They have assisted with 3 business sales over the past 15 years with me. They are honest and sincere and have always performed better than my expectations. They are the only one i would use for the sales of my businesses.”

James Belanger, Business Owner

“I wanted to take a second to commend the exemplary customer service from both you [Karin Neumann] and Mr. Valentino. It’s both a rarity in the industry, and very much appreciated.”

Andrew G., Investor

“We worked with Neumann & Associates to investigate the purchase of a research company in 2010 and found Achim to be capable, forthright and realistic. His depth of experience enabled us to fully understand our options, offering creative options that might enable the acquisition. While we didn’t acquire that particular company at that time, we know exactly who to call whenever we’re looking to buy or sell a business.”

Daniel Coates, Buyer

“Purchasing a business through this firm was a pleasure. Gary was very professional and transparent throughout the entire process. I look forward to working with A Neumann & Associates in the future.”

William Klemens, Buyer

“I utilized A. Neumann & Associates to assist in an M&A process. They are VERY thorough in using their time-tested process to calculate the value of investment opportunities, a process which provided a very detailed explanation for the value of the potential opportunity. Additionally, they also went above and beyond to extend other services including connecting with others who specialize in your industry and can assist with necessary steps including legal and accounting. Highly recommended!”

Edward Lane , Business Owner

“I recently contacted A. Neumann and Associates about getting a valuation of my business done. I spoke with Achim, who explained the process in detail. He had his colleague Gary come to my office in order to get a clear understanding of my business, and what I was hoping to accomplish. His patience in answering all my questions and his knowledge of the proper way to market my business gave me great confidence that this is the firm I will be using when the time comes for me to sell my business for max value. They gave me great insight into the steps I need to take now to get the best deal in the future. I highly recommend this firm to anybody who wants to sell now or down the road. They not only know their stuff, their actually just real nice guys.”

Robert Kardane, Business Owner
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Contact A Neumann & Associates, LLC

If you are considering selling your business, please contact us to learn more about our comprehensive service spectrum. Our experienced professionals will answer all your questions about selling a privately held business in complete confidentiality. Please fill out our contact form, or call us at 732-872-6777. We will contact you directly and will never identify ourselves to your employees.

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