Transaction Risks

Like us, you may have experienced some of the following issues in transactions. We aim to mitigate these with a structured process and continual communication.

  • Agreeing terms = transaction (Taking the foot off the pedal)
  • Trying to make a prospect/transaction fit (“If it looks like a fish, smells like a fish, it’s a fish”)
  • Small and large transactions can take similar time and energy
  • Transaction sponsors “gaming” the process and/or negotiating the price upfront – conflict of interest
  • Unclear accountability and/or responsibility – “Anyone can do a deal” (so they do)
  • Offers and pricing that is not peer-reviewed (it’s difficult to mark your own homework)
    • That’s why it’s a benefit having a team vs a lone operator
  • Orphan transactions – unknown to/not supported by business unit allocated to
  • Bringing onboard disillusioned owners
  • Acquisitions can have a significant price above tangible NAV destroying earnings if accounting allocation between goodwill and amortised intangibles is not carefully considered
  • Incomplete implementation, incorrect book entries
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