Growth by Acquisition

The TXIBB’s “Growth by Acquisition Program” (GAP) is specifically designed for existing business owners who want to grow their business via acquisitions of privately held businesses.

The typical approach for a business owner looking to grow his business by an acquisition of another company is to call all the business brokers in town in the hope of finding a business listed for sale that is remotely close to what he is seeking. Most of the time, the brokers don’t have any businesses for sale that meet the owner’s requirements and the conversation ends with the broker saying “I’ll call you if something comes up”. The odds of the business owner getting a call in the future are extremely remote. If the broker does have a business listed for sale, the broker begins asking a lot of qualifying questions of the business owner because the broker has a fiduciary responsibility to obtain the best deal for the seller. Using this approach, the possibilities of a successful business acquisition are extremely low. The net result is the business owner becomes frustrated and wastes a great amount of his time by dealing with numerous brokers who may not have the best idea of how to put together a successful acquisition that meets the specific needs of the business owners.

Our approach minimizes the amount of time and effort our Buyer client spends in searching and interviewing unproductive prospects. We accomplish this by representing the business Buyer as our client from the beginning of the search process through a successful purchase transaction. Once the Buyer decides to move forward with our “GAP” program, a senior member of our staff will meet with the Buyer’s representative to discuss their acquisition needs in detail by revenue size, industry, cash flow, capital investment, and geographical area. Shortly thereafter, we will present a customized search program identifying a list of Target companies that we plan to contact and our customized letter of introduction for the Buyer’s approval. Our introductory letter would inform the owners of the Target companies that we are representing the business Buyer in his desire to acquire a company in their industry and would include several key phrases that promptly get their attention.

Within 7 to 10 days after the contact letter is mailed, your TXIBB’s representative will call the Target companies to determine whether the owner has any interest in further discussion. If yes, then we will qualify the degree of the owner’s interests to determine whether further discussions are appropriate. If a deal should arise, we work with our Buyer client, and his financial and legal advisors, thru the entire buying process from the initial offer stage, due diligence, and the final contract stages to closing. Sometimes, an acquisition may not occur, but joint ventures, partnerships, and other business opportunities could be negotiated. We get paid our fee only if a transaction is successful. Our representation is on a non exclusive basis; therefore the Buyer is free to pursue any other opportunities.

 

Some of the benefits to our Buyer clients of our “GAP” program are:

1. The business owner may be thinking about selling, but does not want to put the business on the market because he is concerned about his employees finding out about a pending sale. Our approach allows the business owner complete control over confidentiality. THIS IS A MAJOR ISSUE WITH BUSINESS SELLERS.

2. Our Buyer client usually has no competition for the business from other buyers since the business is not yet “on the market”.

3. We prequalify the owner to determine how serious they are so our Buyer client doesn’t waste time seeing unmotivated prospects.

4. Our Buyer client has an experienced professional business broker representing him in the transaction that will give him guidance and assist him in overcoming the problems in closing the deal that typically occurs.

5. Since our buyer clients typically have an existing business, and they usually are acquiring another business in the same or a related area, financing of the acquisition with a minimal down payment can usually be obtained. In many case, we can assist in obtaining financing.

6. We can reach out to other brokers in our network and quickly determine whether the business they are marketing for their seller clients meets our Buyer client’s needs.

 

Our Growth through Acquisitions Program (GAP) is a terrific way for business owners to quickly grow their business at a minimal cash outlay. Call us today for more details as to how we can help you expand your business sales and profits.