Bilateral sale support for owner-managers

A buyer has approached you directly. The conversation is flattering, the indicative number sounds reasonable, and there is a strong argument for keeping things simple and confidential rather than opening a formal process.

That argument has merit. It also describes the circumstances in which owner-managers most often sell below what the business was worth.

The structural disadvantage of a conversation with one buyer

In a bilateral negotiation the acquirer holds nearly every informational advantage. They have completed transactions before and you probably have not. They know what comparable businesses in your sector have traded at and you are relying on an assumption. They control the pace, and they know that the longer the discussion continues, the more committed you become to it concluding.

None of this makes them adversarial. It simply means the process is asymmetric by default, and the asymmetry is worth money.

How we level it

• Establishing an independent, evidenced view of value before you respond to any number, so the negotiation starts from your analysis rather than theirs.

• Understanding the buyer: their acquisition history, their strategic motivation, and what your business is worth to them specifically as opposed to the market generally.

• Managing information release in stages, so diligence proceeds without exposing commercially sensitive material earlier than it needs to be.

• Taking the position of the party who can say no, which is the single most valuable role an adviser plays in a bilateral deal.

• Coordinating legal and financial advisers so the process keeps moving and nothing sits waiting for a decision nobody has been asked to make.

Testing the market without running an auction

The most common concern is that introducing competition will lose the buyer already at the table. In practice a discreet approach to a small number of credible alternatives rarely does. It establishes whether the offer is competitive, and the buyer’s awareness that it is not the only option is frequently worth more than any negotiating position you can construct without one.

This can be done quietly, on a controlled timetable, with a handful of parties rather than a broad market process. It is not the same as putting the business up for sale.

The terms that matter beyond the headline

Price is the number that gets discussed and rarely the one that determines what you receive. The structure decides that:

• How much is payable at completion against how much is deferred, and what security sits behind the deferred element.

• Earn-out mechanics, and specifically who controls the levers that determine whether targets are met after you no longer run the business.

• The working capital mechanism, which can move the final figure materially and is frequently agreed with the least scrutiny.

• Warranties, indemnities and the caps and time limits attached to them.

• Any requirement for you to remain, in what role, with what authority, and for how long.

Senior advisers, no associate layers

Sam Miller and Stephen Murray lead every engagement personally, with more than 50 completed transactions between them and a largest single deal of £100m. In a bilateral process, experience on the other side of the table is the substance of what you are buying.

Common questions

A buyer has approached us. Should we tell them we have an adviser? Usually yes. It signals that the process will be run properly and tends to improve the quality of the first formal offer.

Will bringing in an adviser make us look uncommitted? No. Experienced acquirers expect advisers and generally prefer them, because a well-advised seller makes for a cleaner process and fewer surprises before completion.

Can you get involved once negotiations have started? Yes, and frequently we are. It is more effective before heads of terms are signed, but there is meaningful work available afterwards, particularly on structure.

What if we decide not to sell? That is a legitimate outcome and sometimes the right one. Understanding what the business is genuinely worth is valuable whether or not you proceed.

How quickly can you get involved? Within days. If you have received an approach, the most useful time to speak is before you respond to it.

Related services

• Exit Planning - if the approach has prompted you to prepare properly for a later sale

• Financial Readiness & Modelling - for the information a buyer will request in diligence

• Management Team Strengthening - where a buyer has raised succession as a concern