merger Archives - Page 5 of 14

Want to Merge? Ask for Data

October 28, 2015

BONUS CHECKLIST: 17 data points you should exchange. And don’t forget the client list.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

I have always been a big believer in the buyer and seller exchanging financial and operating information as early in the process as possible. Numbers aren’t everything, but they do speak volumes. The data enables each firm to gain an understanding of the other in a manner that is not always possible in conversation.

MORE ON MERGERS:Merger Prep: Getting to Know You | One Times Fees Is a Steal! | The Merger Process in 21 Steps | Plant Seeds to Turn Up Merger Candidates | Looking to Grow Your Firm? How to Find a Seller in Four Steps | 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge

The data is also a good way to corroborate things that are said verbally.

Merger Prep: Getting to Know You

October 21, 2015

By Marc Rosenberg

BONUS CHECKLIST: 18 questions to ask and answer.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

All merger discussions have to begin somewhere. After merger candidates have been identified, there obviously needs to be an initial meeting for the two firms to get acquainted.

MORE ON MERGERS: The Merger Process in 21 Steps | Plant Seeds to Turn Up Merger Candidates | Looking to Grow Your Firm? How to Find a Seller in Four Steps | 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge | Mergers 101: When Negotiations Aren’t Really Negotiations

Everything is confidential and informal. No exchange of financial statements. The two parties simply spend an hour or two – you guessed it – getting to know each other. Many firms like to convene this meeting over breakfast or lunch because meeting at a restaurant gives the encounter an air of informality and sociability. Other firms like to do this in the larger firm’s office so that the smaller firm can get a “house tour.”

One Times Fees Is a Steal!

October 14, 2015

By Marc Rosenberg

The math might surprise you.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

Partners in accounting firms are familiar with the rule of thumb that a CPA firm’s goodwill is worth one times fees; however, like many “rules of thumb,” this notion is often incorrect.

When buyers begin to think about how much they will pay for a smaller firm, they often have this one-times-fees notion in the back of their minds. Then, when sellers are bold enough to ask for a price in excess of one times fees, buyers often balk because they feel that the asking price is too rich.

MORE ON MERGERS: The Merger Process in 21 Steps | Plant Seeds to Turn Up Merger Candidates | Looking to Grow Your Firm? How to Find a Seller in Four Steps | 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge | Mergers 101: When Negotiations Aren’t Really Negotiations | 5 Steps to Take Before Merging

The purpose of this chapter is to demonstrate that buying a small firm for one times fees is a steal (for the buyer). In fact, it’s still an outstanding investment at a premium price, say, as high as 1.3 times fees. Let me illustrate.

The Merger Process in 21 Steps

September 30, 2015

By Marc Rosenberg

PLUS: 15 potential deal breakers and non-negotiables.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

It’s important to understand the flow of the entire merger process.

Every merger has its unique aspects. It’s impossible to choreograph, from A to Z, exactly how the process for all mergers will work. The steps in the process listed below appear in the order of how they commonly occur.

MORE ON MERGERS: Plant Seeds to Turn Up Merger Candidates | Looking to Grow Your Firm? How to Find a Seller in Four Steps | 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge | Mergers 101: When Negotiations Aren’t Really Negotiations | 5 Steps to Take Before Merging

But again, because all mergers are different, the flow of the steps might vary from merger to merger.

How Savvy Growth Firms Attract the Best Merger Candidates

September 23, 2015

By Marc Rosenberg

You need to be on the lookout year round.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

Firms that are serious about merging in smaller firms on a regular basis understand that doing mergers is all about planting seeds. A buyer has to have this attitude:

MORE ON MERGERS: Looking to Grow Your Firm? How to Find a Seller in Four Steps | 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge | Mergers 101: When Negotiations Aren’t Really Negotiations | 5 Steps to Take Before Merging

Every day of every year, at least one firm decides to test the merger waters. If our efforts to identify sellers are made continuously throughout the year, every year, sooner or later, we will find at least one interested merger candidate and probably more than one.

Looking to Grow Your Firm? How to Find a Seller in Four Steps

September 9, 2015

By Marc Rosenberg

BONUS: A sample letter to send prospective sellers.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

In all areas of mergers and acquisitions, it’s always much more difficult to find sellers than buyers. This is certainly true in the case of CPA firms.

CPA firm merger consultants and brokers can do a great job finding buyers, but they are limited in their ability to dig up sellers. This is because the vast majority of all mergers and sales take place when buyers or sellers who “know each other” get together on their own without the help of a consultant.

MORE ON MERGERS: 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge | Mergers 101: When Negotiations Aren’t Really Negotiations | 5 Steps to Take Before Merging

One way to identify sellers is to do a snail mail solicitation. Here’s the four-step process:
READ MORE →

11 Merger Tips from Managing Partners

September 2, 2015

By Marc Rosenberg

Sometimes the best voice is experience.

By Marc Rosenberg
CPA Firm Mergers: Your Complete Guide

As you might suspect, in 20 years of consulting to CPA firms, several dozen mergers of my clients have taken place. From time to time, I meet with the managing partner of the firm that was my client and ask them how the merger went, what they would do differently and what advice they would give to firms contemplating a merger.

MORE ON MERGERS: 13 Ways to Screw Up a Merger | 15 Can’t-Skip Merger Terms to Decide | 14 Keys to a Successful Merger | 13 Reasons Accounting Firms Merge | Mergers 101: When Negotiations Aren’t Really Negotiations | 5 Steps to Take Before Merging

Here are some choice morsels.