An advisor is very beneficial to any deal that you plan on making with your business in the future. The advisor is someone who has the most experience and understanding of what transactions have occurred in the field and the optimal way to complete another one for your specific business. The advisor’s expertise and extensive knowledge can be applied to your business goals, especially one that includes a buyout.
There are two main types of buyouts: a management buyout and a leveraged buyout. A management buyout, or MBO, is when a company that is interested in completing an acquisition requires outside funding, whether it is through a loan or a promissory note with the original owner, to complete the transaction. A leveraged buyout, or ,LBO, is a specialized form of M&A where one company intends to acquire another company but does not have the necessary funding. Therefore, an outside loan or promissory note will also be useful to complete the deal.
This is where an advisor comes in. The advisor will create a funding solution that will best fit your business. Advisors with established processes and tool kits are the best ones to work with. There are four areas of expertise that an advisor should manage: deal structuring, lender presentation, lender connectivity and project management. Often these areas of expertise are implemented through proprietary tools of the advisor. The structuring tool designs the best loan structure for the specific acquisition need. The presentation tool offers the best version of the Company’s strategy and financials to the lender. The connecting tool will match the transaction with multiple lenders within the advisors lending platform. Finally, the project management tool will allow you to run the business and accelerate the closing of the deal.
An advisors plan will help to deliver the best value on the amount, price, and flexibility of the acquisition funding raised. Get in touch with an advisor today to learn about the best opportunities for your business.
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