|Business Development— Exit
Whether you are
interested in selling your business today, in two years or
in five years, the financial advisors at California Equity Group
can assist you with developing a successful Exit Strategy
from your privately held company on your timetable and on
your terms and conditions.
Using our propriety process EquityExit™,
the advisors at California Equity Group will work with you and
your management team designates to develop a comprehensive road map that
integrates financial, legal, tax, personal, and business issues
involved in the sale, merger, or divestiture of your company.
Your financial advisor will assist you in the
following seven areas to achieve your objectives:
- Assisting you with development of your
Exit Strategy objectives and goals.
- Providing you with referrals to develop
your Exit Strategy advisory team.
- Determining your business’
current value and Gap Analysis.
- Identifying strategies to build and maintain
your business' value.
- Identifying succession and Exit Strategy
- Selecting the most appropriate
exit route based upon your Exit Strategy objectives.
- Executing the Exit Strategy.
Your financial advisor’s goal is to achieve
your objectives by:
- Maximizing your net proceeds at the
time of your exit.
- Minimizing the taxes you have to
pay upon exiting.
- Ensuring that the price and terms
you receive meet or exceed your post-exit objectives.
- Making certain that your other non-financial
objectives are met.
- Ensuring that you are advised and prepared
to manage your post exit wealth.
Exit Planning Overview
Exit Planning is a deliberate, thoughtful and
flexible process that company owners/shareholders use to leave
the company on their terms and timetables. It is a comprehensive process tailored to your particular
goals and objectives.
The financial advisors at California Equity
Group will help you ask the right questions to formulate and
execute the most effective Exit Strategy to maximize the value
received from your transition.
Start your plan now! Whether your objective
is to maximize the capital gain from the sale, merger, or
divestiture of your company interest, secure a comfortable
retirement, maintain the viability of your company, ensure
employment for the current work force, or pass ownership on to other
family members, action to develop and implement your plan
should start immediately. If the Exit Plan is not complete
in advance of need, it will be done in crisis with potentially
Exit Strategy Objectives
As the owner of a privately held company, you
have two key roles, one of CEO and one of shareholder. As
the CEO, it is your job to make the best decisions for the company.
As a shareholder, it is your responsibility to make the best decisions
about your investment in the company. When it is time to execute
your Exit Strategy, these two roles can be in conflict. Therefore,
effective Exit Planning must take into account the differing
needs of each role.
It is vital to a successful Exit Strategy to
time your exit. Receiving the best price and terms for your
company interest often requires selling, merging, or divesting
at the most opportune time. This means paying close attention
to market and business conditions in your industry.
The financial advisors at CEG will advise you
regarding market conditions such as interest rates, merger
and acquisition trends, and the availability of investment
capital. The ownership and management of the company should
be aware of business conditions involving trends in the industry
endemic to the company, which will increase or decrease its
The financial advisors at CEG will assist you in developing your objectives by asking
you the following initial questions:
- At what point in time do you want
to exit from the company?
- Is the best new ownership for the
company a strategic buyer, a financial buyer, a buyer group, an individual
buyer, other shareholders, existing management, employees or family members?
- When do you want liquidity from
your investment in this company to invest in something
else or invest in retirement?
- How much income do you need from
the exit of this company to achieve your financial objectives?
Exit Advisory Team
It is important to build your exit advisory
team early so that these experts can assist you with each
component of your Exit Strategy objectives. If necessary,
our financial advisors can provide you with referrals for
these experts. An accountant or attorney with a different area
of expertise may be unprepared to provide you with the necessary
advice to successfully implement a complex set of Exit Strategy
Your advisory team should be comprised of the following
- A Financial Advisor with expertise
in mergers, acquisitions, and divestitures along with business
- A Certified Public Accountant with
expertise in transaction accounting.
- An attorney with expertise in transaction
law and estate planning.
- A Certified Financial Planner with
expertise in life insurance matters.
Identify an Exit Strategy advisory team leader who understands
your complete Exit Strategy objectives and can communicate
your goals to other specialists on the team.
The most critical step in planning an Exit Strategy
from your company is determining your company’s market
value and how that value relates to your plans for exiting.
The financial advisors at California Equity Group are certified
specialists in ascertaining the value of your business using
traditional appraisal methods coupled with our extensive database
of past transactions and other industry data. The appraisal
process followed by CEG advisors is a well-developed algorithm
(Strategic Valuation Algorithm™). This process will provide
the ownership of a company with the critical path to the decision
of whether or not their company is positioned to sell for
its maximum value and whether that value will meet the Exit
Strategy financial objectives.
about M&A Valuation Services
If a gap exists between the current value of
the company and the value necessary to reach
the financial objectives to exit, then the value of the company
needs to be improved.
Strategies to Build Value
After completing over 1,000 transactions during
the past 20 years, the financial advisors at California Equity
Group have a deep knowledge of the key elements that all types
of buyers look for in assessing the value of your company
and determining its suitability as an acquisition or merger
more about Building Business Value
Identify Exit Strategy Options
The financial advisors at CEG will assist you
with identifying the most effective method to exit from your
company based upon your Exit Strategy objectives. There are
essentially five methods to exit from your company:
- Sale, merger, or divestiture to a
strategic buyer (either public or private)
- Sale, merger, or divestiture to a
- Sale to a buyer group or individual
- Sale to other shareholders, senior management,
key employees, or family members
- Liquidation or closure
Each of the Exit Strategy options comes with
its own set of tax, estate, financial, and deal structuring
implications. Your CEG financial advisor can assist you with
choosing the right approach to achieve your Exit Strategy
Execution of the Exit Strategy
Based upon the Exit Strategy selected, your
financial advisor will guide you through the merger and acquisition
process. Our financial advisors will confidentially seek out
suitable acquisition and/or merger candidates from our extensive
database of buyers, through our M&A affiliates around
the world, and through traditional marketing channels. We will
negotiate all of transaction deal points, and we will work
closely with accounting and legal counsel throughout
the entire transaction process and through closing. Learn more about M&A Services - Sellers