Best Practices From Recent Mergers - Part 1

The merger activity taking place is hot and heavy. Here are best practices observed from recent mergers we were involved in:

For firms merging up:

Go out on top, like the running back Barry Sanders of the Detroit Lions. Negotiate from a position of strength. Don’t wait until you have to merge.
The MP needs to be committed to the merger and work hard to make it work.
As much as possible, seek a merger partner who really wants you.
Get your house in order before you look for a merger partner. Pay off debt, retire underperforming partners and clean up WIP and A/R.

Posted in Mergers

2 Comments

Lee Frederiksen on June 13, 2011 at 3:51 pm

Marc-
I caught your presentation at the recent AAM confrence in Chicago. Loved your data!
I believe you are right on point with your items here. We did a study on professional services firms that sold for premium valuations. Accounting firms were part of the sample.
Buyers who pay a premium are clearly looking for a large upside. Besides looking for all the items you mentioned they also want a firm with a clear, easy to identify strategy. Typically that translates into a specialization, but not always.
Great post Marc
It’s So Easy | Solutions For CPA Firm Leaders on June 29, 2011 at 2:43 pm

[…] Marc Rosenberg has a good post about his involvement in some recent mergers. […]