Your personal roadmap to business acquisition
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In the DACH region, over 50% of family businesses in all three countries are now heading towards business succession
(Source DIHK Study 2018, IFM-Bonn and KERN Succession Study 2017 + 2020).
The pace of ageing of owners and shareholders is increasing so rapidly,
that a good 60% will already be reached in 2022.
The market situation for M&A: With the retirement of the baby boomers, there is a dramatic slump in demographic succession. There is not only a lack of employees at all levels, but also of founders and successors as company leaders.
And the economic climate is becoming harsher and tends to be more unpleasant. Gradually, but visibly.
Ideal framework conditions for every company buyer, whether you want to become involved as an MBI/MBO in the future as an entrepreneur, are looking for targeted investments as a financial investor or want to grow inorganically as a strategic investor. Or consciously want to expand your employee potential.
If not now, when?
The right time -
Your planned company acquisition requires the highest level of professionalism and discretion at the same time. Trust the Statements from our customers or have a look at one of our National cooperation an. Upon request, we will be happy to name specific contact persons who can give you a personal statement on our performance. Check our values for cooperation.
References for your safety -
You explain and outline your desired company to us. The industry, the specialities, the size, the business model and the possible region as well as the framework of your investment volume. Regardless of whether you are an MBI and an individual looking at the Dream as a future entrepreneur want to fulfil. Want to grow inorganically as a strategic investor or are looking for interesting options as a financial investor. If you wish, we can check possible subsidies for your project through experts.. The funding landscape changes every year and varies from state to state. The national differences between Germany, Austria and Switzerland must also be taken into account.
The start of our cooperation -
As an option to the start of a comprehensive search and investment process, we also offer you personal coaching for your planned purchase. In one day, you will work with us to develop your search profile and optimise your self-presentation to potential sellers. KERN has its own Online assessment for future entrepreneurs developed. With this Potential analysis you will find your most important fields of development and can choose your life’s decision for a future in entrepreneurship in a secure way.
We explain to you in detail the entire process of a transaction and are your sparring partner in the context of a possible takeover as a previous employee of a company. We discuss with you the structure of a business plan and the possibilities of purchase price financing. The content of this day will be discussed with you beforehand and will be geared in detail to your needs. Only then will you decide on further steps and the basic cooperation.
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We get a picture of the sector you are interested in, the conditions in the market as well as the current market development in connection with the possible target groups of the properties for sale.
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As far as known, you provide us with the insider information about the industry and the market that you consider necessary for the property search. We supplement this information from our large national and international network. With our deep connections in the investor and banking environment (more than 300,000 concrete and current buyer profiles), we are able to probe the industry in a targeted manner and compare the information with you.
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With the search profile and market knowledge, we match which strategy promises the best results for your goals. Do we use our national and international networks, stock exchanges, bank distributors etc. and go to the market in general? Or do we work out a very individual list for you (called “long-list”) and then condense it (called “short-list”) to the companies to be contacted.
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For a serious and binding approach to possible purchase objects, we create a neutral investor profile with you. You remain anonymous as an investor and at the same time the potential seller and transferor of a company learns more details about you as an investor. This creates trust and helps to deepen the relationship in your interest. We will discuss with you in advance whether and when we may disclose your identity.
Addressing the target group -
As the leading consulting brand for business succession and an incomparably large M&A network (nationally and internationally with a good 300,000 concrete profiles), we examine all relevant purchase offers for you in this step.
We conduct interviews with potential sellers of companies or investments and thus sound out the best and most interesting offers for you. You will be informed about all contacts and receive a short memorandum on the investment offers.
Identification and testing -
Depending on the procedure or specifications of the seller, we examine the offered company together with you. We analyse a possible offer exposé, question a company valuation or purchase price demand. We prepare you for meetings with the sellers and, if desired, moderate the first meeting. In this phase there are a variety of opportunities for in-depth exchange and with our experience we ensure that you feel competently accompanied at every moment of this examination phase.
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In the course of an investment process (due to the immense variety of possible strategies and options, we will only describe the further procedure in general terms at this point), it is now necessary to check which offer you want to examine in depth and which offer should be bindingly secured by a preliminary contract (letter of intent / LoI). Depending on the number of offers and the dynamics on the seller’s side, this step can quickly take weeks or months. The LoI (Letter of Intent) is not strictly legally binding but commits both sides to a common clarity in the intended transaction. At this point, both sides are committed to negotiating the subsequent framework conditions of a purchase agreement.
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We recommend negotiating the Letter of Intent / LoI in detail and thus establishing joint clarity for the subsequent purchase contract. This helps to prevent misunderstandings and to make the process safer on the decisive metres.
The following is an excerpt of the possible components: Designation of the contracting parties (incl. the possible company form), expression of interest in the implementation of the designated transaction, summary of previous discussion results, concretisation of the transaction project (what will be sold and how), price definition (if applicable, plus performance-related provisions, consultancy or employment contracts and remuneration), concrete timetable (preliminary DD, implementation DD, contract discussion, takeover/transfer), granting of power of attorney in favour of a party examining the object of purchase (e.g. within the scope of a due diligence), presentation of the financing structure of the buyer (bank confirmations, investor presentation, etc.), time limits, conditions, reservations, conditions of use, conditions for the purchase of the object of purchase (e.g. within the scope of a due diligence). (e.g. due diligence), presentation of the buyer’s financing structure (bank confirmations, investor presentation, etc.), time limits, conditions and reservations, confidentiality obligation with regard to the information received, definition of exceptions, sanctions in the event of non-compliance (contractual penalty), claim for surrender or destruction of documents received, reference to the lack of binding effect of the LoI, reasons for termination of the ongoing negotiations and arrangements for reimbursement of expenses.
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To ensure that you actually receive what a seller has promised you, due diligence usually follows an LoI. Due diligence, abbreviated to “dd”, carefully examines and analyses the economic, tax, legal and financial circumstances of a purchase project.
There are different types of dd, the details of which we will be happy to discuss with you and prepare you professionally. Usually, the buyer gives the seller a list of all relevant issues in advance. These documents must then be presented in analogue or virtual form for inspection and examination. Of course, we are prepared for these questionnaires and select the correct and relevant examination questions with you in advance.
In this step of the process, external experts from the fields of law and taxation are integrated for your security, so that a maximum of reliability can be created for you for the upcoming transaction. Within the framework of the dd, there may be a number of detailed questions that only arise from the review of the documents in the various areas. All procedures are recorded and ideally later also become part of the purchase contract. This way, both sides have verifiable documents as evidence in case of an eventuality.
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In the course of a dd, new aspects sometimes arise in the risk assessment of the business model. Detailed information emerges that you as a buyer may assess more critically than you were previously able to on the basis of an exposé or the discussions. This can then be an important and justified reason to reassess the previously negotiated purchase price in the LoI. We are always at your side during these demanding and very important discussions and take over the moderation and also critical questions for the final evaluation of the investment in question. You always remain in a “good” relationship with the seller and transferor. In terms of a tactical, clever approach, this is a point that should not be neglected and ensures the achievement of your goal.
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At the latest with the clarity of an LoI, we begin to discuss the financing structure of the negotiated framework conditions with possible financial partners in parallel. Whether banks, savings banks or financial investors. There are plenty of financing options for the acquisition of your dream company, including attractive subsidies from public banks. We support you not only with our excellent network to all relevant banks and savings banks, but we also accompany you in the preparation of the necessary documents and the compilation of a business plan.
We also support potential discussions with financing partners to present your planned transaction. Thanks to our many years of expertise in the M&A market and a good reputation as a leading consulting brand for business succession, personal contacts and arguments sometimes come into play convincingly.
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At this point and among the many possible process steps described above, we would like to emphasise one particular feature:
You are always the decision-maker in all the steps in which we accompany and support you! This is not only important for the sake of a stable relationship of trust, but especially for your safety.
This way you know exactly what, when, how and where to do at which point or which questions and decisions are coming up.
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You are now close to the goal: The final purchase agreement is drawn up and negotiated on the basis of the already signed LoI. It is possible that findings from the due diligence process will also be included.
In the purchase contract it is now important to pay attention to detail. We recommend that you choose one of our experienced regional legal experts (often with a high level of tax expertise) and then draft the first draft together. We expressly advise you to have the draft drawn up by you as the investor, as it will then be easier to address your most important concerns in terms of content and drafting. This draft will then be the basis for the final negotiations with the seller. As is so often the case, the devil is in the detail when it comes to such a comprehensive set of contracts. Depending on the type of company, a notary is mandatory or can be chosen.
Our urgent recommendation: Never do such transactions verbally and never without professional help from experienced (!) M&A advisors.
The final - shortly before the finish -
If desired, we will accompany you during the implementation of the payment and handover. In the case of performance-based purchase price shares, further payments may extend over future years and depend, for example, on certain target parameters. Should misunderstandings or even disputes with the former seller arise in the process, we support and accompany you with our experience as business mediators and conflict moderators.
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The real work is only beginning now ?
You want to align your new company with the new future in terms of organisation and together with the employees or, for example, implement an integration with your existing company. This requires a lot of time and tact for an optimal result. If you wish, we will also remain at your side in this task. As a trusted sparring partner at eye level for personal exchange. Or as coaches (also extended by experienced network partners who are at home in the areas of synergy, change management, corporate mission statement, etc.) to facilitate the process of integration or realignment and to achieve it in a goal-oriented manner.
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You have successfully achieved your goal ? The takeover of your dream company or a shareholding is now implemented and a reality.
You have created an important value component of your assets for your future and will now drive the development forward.
You have succeeded in meeting a weighty challenge in your entrepreneurial life with this transaction.
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Congratulations!
Basic webinar: Company acquisition (M&A) - self-employment or strategy for growth
You will learn how and where to find the best transferors of businesses. You will learn how to eliminate the 7 most expensive mistakes and why subsidies help to finance the purchase price.