Getting Deals Done: A Team Sport

Acquisitions are an important form of growth for middle market companies looking to become something bigger. They’re more aggressive than growing organically, but they can also provide far more profitable returns.

Performing an acquisition can help your company elevate to the next level, but you cannot do it alone. When your growing company is on the offense targeting an acquisition, you need a whole team of experts in different areas working together as one.

Getting a deal done is a process that requires help from an M&A advisor, lawyer, and financing advisor. Like the offense of a football team, each expert has their own unique job, but each are integral to the success of the offense.

All must work together and take turns at leadership of the team to ensure a deal victory.In this growth offense, your company’s senior management collectively acts as the quarterback; they are the on-field leaders of the offense.

Deep talent in management is important because management is at the helm of the company and is responsible for bringing the offense together—making sure new acquisitions mesh with the current offense. Although they are surrounded by experts in different areas, ultimately your management still has the decision-making authority above anyone else, as a QB does out on the field during a game.

Your lawyer or legal team acts as your offensive line when looking to make a deal. O-linemen speak their own language of protections and blocking schemes, similar to lawyers who are familiar with the specific legal language needed to complete a deal.

Lawyers set up the offense by crafting the letter of intent and purchase agreement. Offensive linemen are in the trenches battling to protect the QB; similarly, the lawyer or legal team are in the trenches finding the right phrasing and legal language to protect your company from a legal standpoint.

Their job is not a very glorious one, but it is necessary to the success of your offense in achieving growth.The financing advisor and M&A advisor, are sometimes one in the same.

They act as part of the coaching staff. They are valued for their experience, and looked to for guidance as a company performs an acquisition.

These advisors know how to land the deal and then finance the deal. There is tremendous value from having a financing advisor land the deal and negotiate with the seller as they know the lender’s requirements as to terms and structure.

The financing advisor acts as the offensive coordinator of the operation. Tasked with finding financing for the deal and being the deal maker, this position requires extensive experience and knowledge of the lending game.

A good offensive coordinator doesn’t act as the boss of the offense, but rather works with the specific offense he has. He will discuss with his quarterback the different offensive strategies available—whether they should be a run-heavy offense, pass-heavy, or a balance of the two.

In the same vein, a financing advisor will discuss with the owner of the business different financing options. They will explain the differences between cash-flow, mezzanine, and Unitranche loans.

They will also decide whether a loan, equity, or a combination of the two is the right option. Smart offensive coordinators play to their personnel, and smart financing advisors consider their company’s current position when structuring a deal’s financing.

The cardinal rule is to ensure the company has several lending options to close the deal. When we visualize making a deal, many would picture a simple handshake.

Finalizing a deal may be done with a simple handshake, but too often all the complicated steps and moving parts that led to that handshake are overlooked. Getting a deal done is a drawn out process that requires a wide array of expertise.

Trying to make a deal on your own will have you in way over your head, but surrounding yourself with the right team of experts can mean making the acquisition that transformed your business, elevating your company to a leader in its field.