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Mergers & Acquisitions For Dummies
book

Mergers & Acquisitions For Dummies

by Bill Snow
September 2018
Beginner to intermediate
368 pages
9h 12m
English
For Dummies
Audiobook available
Content preview from Mergers & Acquisitions For Dummies

Chapter 19

Ten Considerations Prior to Signing an LOI

IN THIS CHAPTER

check Getting a handle on the deal and payment setup

check Keeping an eye out for warning signs

Moving forward with an M&A deal means that both sides sign a letter of intent (LOI). Although the LOI is an important step, rushing and carelessly signing an LOI without fully understanding it can create plenty of problems. To help you avoid problems and increase the odds of a successful closing, this chapter presents ten issues to consider before signing an LOI. Check out Chapter 13 for the nitty-gritty on LOIs.

Is the Deal Too Good to Be True?

This caution is especially true for Sellers. That great deal that Buyer is dangling may be nothing more than a Trojan horse, a ruse to lock up you, the Seller, with exclusivity for a period of time before coming back with a lower price after you’ve been out of the market and are therefore in a weaker position. Even if Buyer isn’t trying to pull a fast one, he may not be able to line up the capital needed to actually close the deal he’s offering (see the following section).

warning As a Seller, you need to be brutally honest with yourself about your company’s value. Frankly, an experienced advisor ...

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Mergers & Acquisitions for Dummies

Mergers & Acquisitions for Dummies

Bill Snow

Publisher Resources

ISBN: 9781119543862Purchase book