Note to the Reader: This is the second in a series of articles that explore the definition, application and issues of including earn-outs in negotiated M&A transactions. An earn-out is an opportunity for both buyer and seller to maximize their respective post-acquisition returns on investment, but it doesn’t always play out that way. Generally, there […]
read moreAn earn-out can allow an otherwise willing buyer and seller to bridge the gap in their respective valuation concepts for the business in order to complete a sale. In periods of economic and political uncertainty, earn-outs seem especially attractive because they can help get deals done in a difficult business climate. Recently, one adviser gave […]
read moreStrategies to Avoid the Overpayment Trap The Overpayment Trap explored how the M&A process is oriented toward getting sellers top dollar for their companies. Becoming mindful of the overpayment trap and deciding to take proactive measures to avoid it are essential first steps. This article provides specific strategies and techniques that you can use to […]
read moreThe price paid for a lawfully acquired business interest is a fait accompli—an accomplished and irreversible fact. The parties have negotiated, had an opportunity to perform their due diligence, reached a meeting of the minds and consideration has changed hands. The transaction is done—the cash register has gone Ka-Ching. While the price paid is a […]
read moreBook Value is the difference between a company’s Assets and Liabilities as stated on the current Balance Sheet. Book Value is an accounting term and does not provide a meaningful measure of the business value. Liquidation Value is the net amount that would be realized if the business terminated and the assets are sold piecemeal. […]
read more