The Allegiance Capital Difference
Our dedicated execution teams provide constant guidance and transaction stewardship throughout the process to maximize value for the owners/shareholders while minimizing business disruption and use of management resources.
Sale transactions are typically characterized in the following four broad phases: Pre-Market Preparation, Marketing Phase 1, Marketing Phase 2, and Due Diligence & Documentation.
One of the key activities in this phase is the preparation of the offering memorandum or investor presentation that includes a detailed description of the business and its operations, a summary of opportunities within the market, financial information including projections and adjusted EBITDA, and a summary of the proposed transaction structure. This is also referred to as “packaging” the company for sale. Additionally, a highly researched and thoroughly vetted buyers list is prepared at this stage.
Marketing Phase I
This phase of the transaction is focused on procuring Indicators of Interest (IOI) – written, non-binding documentation from the buyer(s) that includes the buyer’s approximate purchase price range, the buyer’s availability of funds and financing sources, estimated due diligence timeline, proposed transaction structure, and timeframe to close the transaction. In a typical sale transaction, an in-depth exhaustive marketing effort is undertaken to generate buyer interest and competitive IOIs.
Marketing Phase II
This phase is centered on the evaluation of the offers and culling from the group those potential buyers who will be given access to management for additional discussions. Only those who are best-aligned with the owners’/shareholders’ investor criteria are invited to meet with the business owner(s) and Allegiance. Prior to these meeting, the bankers will prepare the business owners for the types of questions that will asked, including those concerning buyer due diligence. After the meetings, Allegiance evaluates proposals and conducts its competitive bidding process to receive the highest price and best terms for the company.
Due Diligence & Documentation
Some of the key factors in this phase include: Letters of Intent, information requests and due diligence, the purchase agreement, and the closing. Allegiance analyzes all offers from the buyers to help owners select the best fit for their objectives. Allegiance negotiates the letters of intent on the client’s behalf, provides ongoing and proactive consultation throughout the due diligence process, and negotiates a prompt closing of the transaction.