Selecting Your Advisor
Your evaluation and comfort with your M&A Advisor goes a long way to the success of your transaction. Meet with your potential advisor and understand his/her qualifications and capability to meet your needs.
Credentials
Jack Cox has a Bachelor of Science in Accounting from the University of Scranton, a Masters from Regis University and a post graduate Certificate in Finance from Fairleigh Dickinson University.
Jack Cox is a Certified Public Accountant (CPA), a Certified Merger & Acquisition Advisor (CM&AA) and Certified Exit Planning Advisor (CEPA).
No. Although John (Jack) J Cox is a licensed realtor in New Jersey, his primary business is exit planning and M&A advisory for the lower middle market business owner.
Jack belongs to several industry related organizations that provide networking as well as resources. Those organizations include the Exit Planning Institute, The Exit Planning Exchange, the Alliance of Merger & Acquisition Advisors, the International Business Brokers Association, the American Institute of Certified Public Accountants and the New Jersey Society of CPAs are all relevant organizations in the exit planning and M&A advisory role.
Jack has either solely handled or assisted in the following transactions:
Sale of outpatient treatment and recovery center to private equity platform company.
Facilitated valuation and minority sale of home safety equipment installer to a major hospital network.
ESOP of industrial HVAC and plumbing company.
Managed sell side due diligence in the sale of a behavioral analysis practice to a financial buyer.
Sale of cold storage company to private equity backed independent sponsor.
Sale of plumbing contractor to strategic buyer.
Sale of engineering consulting firm as add on to platform company.
Sale of patent and trademark renewal company to a private equity platform company.
Various analyses for potential buyers on transactional value of various targets.
Jack has dealt with many parties during the course of his career.
Jack is well versed in reviewing the documentation surrounding the sale and also realizes that he needs the support of competent counsel to execute a transaction.
Pricing of the Business
As part of the preparation for sale, Jack performs a business valuation for transaction purposes and employes three different approaches: Asset, Income and Market (comparable companies).
The pricing analysis is transparent and explainable in achieving a fair price for all parties involved.
Confidentiality
Firstly, we identify a target list and working with the owner, we reach out to only buyers we think may be qualified with a confidential teaser or phone call. Before we share the seller’s identity to the potential buyer, we receive a Non- Disclosure Agreement. Before going much further, buyers are required to show some evidence that they have the financial wherewithal to execute a transaction even before providing an Indication of Interest. To address confidentiality from within the company, we work with the owner and only the necessary employees to prepare the business for sale. Through these collective efforts, we can’t guarantee that confidentiality will be maintained, but we can preserve it as best as possible.
Marketing
The marketing plan includes the development of a Confidential information Memorandum which includes various aspects of the business, while not disclosing everything. It should serve as a basis for the potential buyer to provide an Indication of Interest, including a range of value.
We provide weekly updates on activities.
Our process includes a step by step plan to sell a lower middle market business and that plan shows a 37 – 39 week timeframe between starting the engagement to selling the business. There are certain uncontrollable aspects of selling a business so that timeframe can be both shorter, if a buyer is highly motivated, or longer.
Fees
As indicated above, the timeframe for selling a business is lengthy. Also, the intermediary can’t bear 100% of the risk associated with a success fee only engagement. Fees are negotiable, but there is typically with any qualified intermediary, an up front fee is charged and a monthly retainer. At least a portion of the monthly retainer is typically used to offset against the success fee at the end of the engagement.
If travel includes airfare and hotel stay, those costs would be charged. The cost of advertising is part of the service.
Interpersonal skills
This needs to be decided from both sides. The sale of the business is unlike the sale of the house where the buyer and seller may never directly meet and are comfortable arguing over every detail until closing. In a business sale there has to be an exchange of knowledge post sale. In addition to working with your intermediary, the seller needs to be able to work with the buyer and vice a versa. If cooperation does not seem as if it will be possible, the transaction will likely not occur.
For whatever it is worth, Jack Cox has been involved in many community activities and was once named Volunteer of the Year by his town, Morris Plains NJ