subject: 5 Steps Your Investment Broker Should Take To Help Best Position Your Surgery Center For A Sale [print this page] In order to obtain the best price when selling your ambulatory surgery center, it is imperative to reach out to and consider a wide range of potential suitors and to do so in a systematic fashion early on in the process. If you do not have at least a few concrete and articulable alternatives, you have no leverage. And without leverage, the experienced negotiators on the buyer's professional development staff will surely take advantage.
Negotiation researchers Roger Fisher and William Ury of the Harvard Program on Negotiation conducted in-depth analysis of what they call the "Best Alternative to a Negotiated Agreement" (BATNA). An experienced and caring registered investment banker will see the BATNA not as a safety net, but as a point of leverage in negotiations for the sale of ASC. By carefully and systematically conveying the BATNA to prospective purchasers at the critical juncture in the negotiation process, your investment professional will put you in the best position, whether your ideal suitor is raring to go, blessed with deep pockets or both.
Here are five steps your investment broker should take to help best position your surgery center for a sale.
1. The ideal sell-side process is comprised of a two-stage solicitation process. It begins with the investment broker doing the work required to understand the seller's needs and wants for the sell-side transaction. As the seller, your goals should guide and underpin the framework for the entire undertaking. Some sellers are absolutely clear on their objectives for a sale, while others require more time and information before they are sure of their desired end. Your investment banking professional should understand and help you understand the ramifications of various alternative deal structures so you can choose the best structure to realize your goals for the sale.
2. After you have identified your ASC's ideal outcome, your investment broker should help you prepare a Confidential Seller Profile and Confidentiality/Nondisclosure Agreement. The Confidential Seller Profile briefly highlights those attributes of your company most likely to appeal to potential purchasers. The Confidential Seller Profile is intended to be an anonymous description of the company in play (in this case, yours). Once these documents are reviewed and approved, they will be among the first documents provided to prospective buyers.
3. Your investment broker should then work with you to begin gathering the information needed to develop the Seller Memorandum. The Seller Memorandum is the central marketing piece for the sale of your ASC; it provides more comprehensive view of your company than the Confidential Seller Profile. The Seller Memorandum highlights your company's financials, operations, management, strategy and ideally a fiscal model. It also places your company in an appropriate context, with a thorough discussion of relevant micro- and macro-economic forces facing the industry.
4. Your investment broker should then identify and highlight the specific attributes of ASCs prospective buyers value most highly. Your Seller Memorandum should be written to identify and highlight those attributes, as well as to call attention to benefits and advantages that a prospective purchaser may not previously have considered.
5. Once the Seller Memorandum is complete or even while it is being developed the next step is to identify prospective and the most qualified buyers for your ASC, with the emphasis most assuredly on the word "qualified." Your investment broker should conduct exhaustive research to pinpoint appropriate would-be purchasers and investors. Registered investment brokers will have access to public databases of information and, if he or she is a seasoned professional with broad experience in the ambulatory care industry, will probably also have a sizeable proprietary data warehouse.
Throughout this delicate period in the sell-side process, your investment broker should exercise the utmost discretion and work with you and your other advisors to ensure each contact with a prospective buyer is appropriate in terms of both timing and content.
by: Christopher j Wall
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