The first question that comes to mind for many people is, “What distinguishes a Mergers and Acquisitions (M&A) practitioner from a general business broker?” The answer, for the most part, may be attributed to the accumulated level of education, training and experience of the individual.
- Gross Revenues in $ Millions.
- Earnings before Interest, Taxes, Depreciation & Amortization (EBITDA) in excess of $1,000,000.
- Historical track-record of significant Revenues and Earnings which can stand-up to the rigors of financial “due-diligence.”
An M&A Specialist is trained to understand the more complex issues of deal-making, including:
- The application of appropriate capitalization rates (multiples of earnings) to determine Fair Market Value of an on-going business.
- The benefit/harm of the “allocation” of the Purchase Price between the various assets of the business.
- The risks/benefits of “asset” structured sales as opposed to “stock” sales.
- The consequences of the representations and warranties made by the parties that survive the transaction.
Additionally, an M&A Specialist understands the “ebb and flow” of the deal. He or she can guide a buyer or seller through the tangle of documentation, due diligence and negotiations that usually accompany the sale or acquisition of a substantial business.
Sunbelt Atlanta has brokers who possess the necessary criteria mentioned above to skillfully handle a “larger” or more “complex” transaction.