{M&A Process/8} Buyer list

The quintessential third-party M&A process is a limited auction. A limited auction targets a group of around 50-100 potential buyers (typically around 50) on a confidential basis, and usually involves controlled bidding involving specific stages and timelines designed to create competition and move the process forward.

Prior to kicking off a limited auction, we develop a buyer list. To do so, we first work to understand our client, its business, operations, and strategy, and where it fits in its industry. We then consider:

▶ Who are the most likely buyers?

▶ Who are the active buyer in the industry?

▶ What PE firms are active buyers or have expressed interest in the vertical?

▶ Are there related or adjacent industries that could be a good fit?

▶ Has our client received unsolicited offers?

Using the information gleaned from the market study, as well as additional research based on those question and client input, we develop a buyer list of potential purchasers that we invite to participate in the auction.

The buyer list includes targets that are strategic buyers (ie, industry participants and competitors), financial buyers (ie, private equity firms and family offices), and hybrids (strategics owned by private equity firms).

The buyer list is approved by the client, and then supplemented and refined throughout the process.