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Outside Offer: Unsolicited Offer

What To Consider In The Situation

How many calls, emails and letters have you received from a person saying that they are either an interested buyer or that they have an interested buyer for your business? They seem so personal, so truthful, and yet if you do respond to them, it is rarely true. Occasionally, you may even get an unsolicited offer that stops you in your tracks. You read the offer, get excited about the price and then start to dream. Someone is willing to pay this much money for your business without asking for a single piece of internal information. Is it too good to be true? If they would pay this much, should you sell now?

We all love to be appreciated and it’s flattering to get an attractive offer for your business. It fills the ego and may be a validation that all your time and effort is someday going to pay off. Unfortunately, rarely does an unsolicited offer actually turn into a sale. It’s a fun distraction and you will learn a lot as you explore the option; however, these people are professional buyers. All day and every day they are trying to buy businesses. This is your once-in-a-lifetime opportunity and you need to bring your A-team to the table.

 

How ECG Supports The Situation

We are licensed M&A advisors, who have completed hundreds of transactions. Being professional sellers, we know how to talk to professional buyers. We will quickly come to your side, evaluate your business, the buyer and the offer to see if it is worth your time. We take the lead role in the negotiation and sale process so you can continue to focus on running and building value in your business. We become the transaction manager and will represent you in negotiating the deal.

The Pain Point

Three partners had a successful, industry-specific business when a private equity firm brought them an unsolicited offer. It took them by surprise, and they were not sure what to do. It was a good price, but the payment and employment terms were confusing. They had no idea what the company was worth, so they didn’t know if the offer was a good one and hadn’t considered the tax ramifications or agreed together on the next steps. They were already extremely busy with their work, so this distraction was affecting their business.

The Solution

We worked with all three partners to help align them with defining their WINs. We performed a business valuation and reviewed the letter of intent with their tax advisors. We negotiated on behalf of the owners so they could continue focusing on growing their business.

The Result

After 30 days of negotiations, the partners decided they were not ready to sell and wanted to continue to grow their company. The process unified the partners, and they learned a lot about their business value. They were very appreciative of our Exit Engineering® efforts and results and are now planning a strategic exit in the future.
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