If you are involved in a business transaction buying, selling or merging businesses, you can expect that the transaction fees will range from 1% - 5% of the transaction's value. Attorneys' fees will account for .5% to 2% of that figure. On small deals, these percentages will not have much relevance because the same work is essentially required on a $30,000 deal as on a $100,000 deal.

Acquisitions.

Generally, in evaluating an Acquisition, consider creating a business plan (or bank book) which allows you to crunch the numbers and justify for your company that the opportunity is a good one.

However, you may want to prepare the material and any presentation in a different way. One popular evaluation technique is called "The Wheel of Opportunity/Fit Chart Approach." By making this analysis and wrapping it within the presentation, you may bring your audiance to your conclusions.

First, examine the various strategic planning levels.
These are:
Enterprise Strategy - Why are we in this business or core businesses?
Corporate Strategy - the allocation or reallocation of sector level cash flows.
Sector Strategy - combining or dividing business units based on common operating factors. Business Unit Strategy - reinvestment of profit center's cash flows
Product-Line Strategy - examining product life cycles
Functional Strategy - cost cutting analysis and alternate methods of production.

At each of these strategic levels, ask yourself:
1. What are our strengths and weaknesses?
2. What are our alternative opportunities for acquisitions and other changes?
3. What are our priorities for building on strengths and correcting weaknesses? and
4. How do our opportunities fit with our priorities?

As you make this evaluation and place it within the framework of your presentation, you may find areas that you should highlight. For instance, you may find at the Functional Strategy level that your company has a manufacturing technique that the target does not use, but when applied to the target's product line completely changes the cost/pricing equation.

In addition, make it simple. You might provide a framework showing the full analysis and then talk about only two or three key items.

A good resource and a more detailed discussion of the above material is at Reed, Stanley Foster & Lane and Edson, P.C., "The Art of M & A, A Merger Acquisition Buyout Guide" Dow-Jones & Company, Inc. (1989). Another good resource is the three part article by Mr. Stanley Foster Reed in "Mergers & Acquisitions, Vol. 12, Nos. 2, 3, 4 titled "Corporate Growth by Strategic Planning."

Business Opportunities (Member Section)

If you are currently looking for acquisition or sale opportunities and would like Mr. Cooke's help, contact Mr. Cooke at: (312) 497-9002 or by email at "gc@Cookeslaw.com".

Mr. Cooke has participated in:

- The 1987 Ralston Purinaª $1.6 Billion Dollar EverReady Acquisition

- The 1990 Anchor Glassª $400 Million Dollar Acquisition and 1991 $270 Million Dollar refinancing as assistant local counsel

- The 1997 - 2001 CityLink Airlinesª $25 Million Dollar Private Placement as General Counsel

- The Acquisition Consulting Team hired by a large Chicago Real Estate Developer wanting to acquire an Insurance Company. The Team advised the developer, evaluated targets and recommended courses of action and strategies

- The evaluation and preparation of a variety of Asset and Stock Sale Transactions, Restructurings and Refinancings

- The examination of a variety of business opportunities

Mr. Cooke's fee is $300.00 per hour.

For Customized work contact Mr. Cooke at:
(312) 497-9002
gc@Cookeslaw.com