The biggest fear of an entrepreneur is that the employees will find out about the upcoming business transaction too early. If the transaction fails, the entrepreneur wants to continue running his business. With his most important resources: the employees. Since a potential buyer also has a strong, natural interest in a discreet transaction process, it is important to plan communication about the process carefully.

A professionally conducted corporate transaction is discreet. There are many reasons for this. One of them is the fear of the seller and the buyer that employees will suspect something and unrest will arise in the company. This is all the more true if the entrepreneur is under 60. In the case of older entrepreneurs, employees usually know that the owner intends to take a well-deserved retirement. In this case, it is even detrimental to the company if the workforce is not aware of the search for a succession solution.

The seller’s view

Why is it important to salespeople that employees are unaware of the process of a corporate transaction? This question can be answered in many ways. First and foremost, entrepreneurs always have the thought that the transaction could still fail before signing or closing. Of course, one does not want to leave any “scorched earth” in one’s own company and successfully continue the business.

If employees learn at an early stage of a planned sale and thus of a possible exit of the boss, uncertainty arises. What will happen then? Who will come after? Why is the company being sold? Is the company in trouble? Is my job in danger? These questions are not unusual. They are understandable for employees and also justified. The salesperson must take this into account and make sure that no panic reactions, such as dismissals, land on the desk. But perhaps an earn-out component, which would not be achievable without certain employees, is the reason for continued motivated employees.

The view of the buyer

If the target is not a company that creates its values in a purely digital and automated way, the most important company resource is probably human. The acquirer must therefore ensure that the employees are highly motivated (or re-motivated) to deliver the purchased future performance. In addition, especially in the handover phase, the buyer is dependent on key employees who are usually process owners and maintain direct contact with customers and suppliers.

When do you tell the staff?

The answer is simple: it depends. Professional advisors work with the buyer and seller to create a communication plan for the corporate transaction that includes a timetable and a distribution of roles. Of course, this is done with the effort that is appropriate for the size of the target company. For a 20-employee company, the plan can of course be leaner and more pragmatic. In the past, it has proven successful if the employees are informed personally on the day of the signing or at the latest on the following day. An e-mail or a notice opens the door to speculation. Both buyers and sellers, and possibly the transaction advisors, should be personally available to the staff for questions and answers. On this day and in the days to come, only the positive effects should be mentioned. Direct, noticeable consequences for the staff should be avoided, unless the pay slips show a small, higher net amount afterwards. ?