Guide to a Retained Buy-Side M&A: Pursuing Growth Through Acquisition

Much of the conversation revolves around sell-side transactions in the mergers and acquisitions (M&A) world. This area is often at the top of the mind of business owners looking to exit or transition. But what about those entrepreneurs who are still driven to grow? The ones with ambition, energy, and a vision for scaling their businesses?

Buy-side M&A transactions are a practical strategy to increase market share, enabling business owners like yourself to expand through strategic acquisitions. These deals are designed to help you achieve your long-term goals by identifying and acquiring companies that align with your objectives. Whether it is strengthening your existing market position, adding new capabilities to your production line, or transforming your business operations and models, buy-side transactions provide an alternative avenue to rethink what your business is capable of and achieve sustainable growth.

This blog will dive into what a retained buy-side process entails and what you can expect in the M&A process:

Steps in a Buy-Side Transaction

To give you a clear picture of what a retained buy-side M&A deal entails, here is a short breakdown:

Acquisition Strategy

A successful acquisition starts with knowing exactly what you want to achieve. Clearly define the criteria and benchmarks you want in an acquisition – are you looking to expand your share in the market or add a complementary product to your existing services? With these objectives in mind, you can evaluate each potential deal based on whether it helps you reach those targets.

Preparation & Marketing

Now that you know what you want to achieve, it is time to find companies to help you. This is a great point to bring in M&A experts such as True North M&A. We can be vital in conducting market research, identifying target companies, developing marketing materials, and more.

Target Evaluation & Selection

After identifying potential targets, True North M&A initiates a Business Price Opinion and systematically targets acquisition candidates. The buyer may then make an opening offer and start negotiating – including back-and-forth counteroffers. Due diligence begins after an offer has been accepted.

Deal Sourcing, Pre-Due Diligence, & Negotiations

True North M&A works collaboratively, guiding a business owner in acquiring another company through the transaction structure, purchase price allocation, net working capital, and definitive purchase agreements. Our reverse auction process results in lower prices, higher value, and better terms without damaging the long-term buyer/seller relationship once the transaction closes.

Closing

This is when the deal closes, money is exchanged, and the management teams collaborate on the next steps. It is when the acquiring company begins the implementation of its acquisition strategy. The integration phase concerns the next steps after the acquisition has been successful.

Importance of Working with an Advisor

As I mentioned, working closely with a trusted and experienced advisor can add immense value when seeking to grow through acquisition. The benefits of having a strong advisory team include:

• Access to Relationships & Expertise: Leverage our extensive network and experienced team.

• Proprietary Resources: Gain access to exclusive databases, tools, and market insights.

• Confidentiality & Risk Mitigation: Protect your privacy during the preliminary stages and reduce the risk of premature exposure.

• Strategic Guidance: Receive expert advice on valuations, deal structures, and negotiations.

Our M&A expertise ensures that you confidently navigate the process's complexities while avoiding costly mistakes. We foster competition among potential buyers to maximize the value for all parties, expedite the deal to minimize deal fatigue, and provide realistic valuations to manage expectations effectively.

Supporting Your Growth Strategy

If your company's growth plans include acquisitions, we are here to help you identify and capitalize on the right opportunities. Offering two distinct and effective buy-side services, we can help find off-market opportunities that meet your acquisition criteria. Contact Michael Hubsmith, President of True North Mergers and Acquisitions, to start a conversation.