The internal preparation of a company sale takes about 2 to 3 months depending on the complexity of the company structure and the information available in the company.

The actual M&A transaction with discussions and negotiations with external interested parties as well as due diligence and purchase agreement negotiations takes about another 4 to 6 months, so that the entire M&A transaction usually takes 7 to 9 months.

However, it is helpful and optimises the transaction value if the seller continues to advise the buyer for a transitional period of 12-24 months during familiarisation and later in the event of special challenges.

This cannot be answered in a general way.

There are different methods to determine the value of a company.

If a detailed business plan including profit and loss account, balance sheet and cash flow is available, a detailed discounted cash flow method (DCF for short) can be applied. Here, future financial surpluses in the form of cash flow are discounted to the valuation date. 

If there are comparable public company transactions or comparable listed companies, a multiples method is feasible with significantly fewer key figures of the company. 

For example, this simplified method uses the average EBIT (earnings before interest and taxes) of the last 3 years multiplied by the relevant industry multiple (often between 4x and 8x) and the net financial liabilities subtracted.

If you’d like to establish a solid basis for decision-making first, we can assist you with business valuation even if you’re not planning to sell your company.

Basically, there are three groups of potential buyers.

Strategic buyers acquire companies in the same stage of the value chain (acquisition of market shares) or along their own value chain (suppliers or customers).

Private equity investors buy companies in order to develop their size or their portfolio of offerings. They also might sell the companies at a higher price with the debt relief effect (“leverage effect”) within 3-6 years. 

Family offices usually acquire companies in order to hold them permanently and to receive a continuous distribution as “interest”. Here, too, it cannot be ruled out that there will be a resale at some point – but this is usually not part of the strategy and the holding periods are significantly longer than for private equity investors.

Both types of financial investors (private equity and family office) are dependent on the existence of a functioning, industry-experienced management in the target company.     

Whether strategic buyers, family offices, or private equity investors: Selecting the right buyer is a central component of our sales strategy.

Our references showcase examples of business sales we have facilitated to strategic buyers and investment firms across various industries:

• Business succession in the real estate industry: ImmoKonzept Facility GmbH
• Business sale in the software sector: actum consulting products GmbH
• Succession solution in the food retail sector: Busemann GmbH
• Sale of an industrial company: Lübke & Vogt GmbH & Co. KG