PART FIVE

Completing the Acquisition

You now have a signed LOI for a business that meets your qualifications; your offer has been accepted. Now begins the most intensive part of the process: completing the acquisition. Part V walks you through the steps of confirming your preliminary due diligence, raising capital for your purchase, negotiating the purchase agreement, and, finally, getting to closing day—and beyond.

We begin in chapter 17, “Confirmatory Due Diligence,” when you gain inside access to the prospect to learn more about it. Hopefully, this due diligence will reconfirm why you like the company and will uncover nothing that causes you to abandon the acquisition. While confirmatory due diligence is mainly your effort, you will begin to spend significant amounts of money on outside professionals for the first time since you began the search process. You also need to secure financing, and we discuss this issue in chapter 18, “Raising Debt,” and chapter 19, “Raising Acquisition Equity.” The purchase agreement defines the specific terms of your acquisition and is full of important details that you and your lawyer will negotiate with the seller and the seller’s lawyer; we discuss the important provisions in chapter 20, “Negotiating the Purchase Agreement.” Finally, we end part V with some thoughts about the closing day and the first few weeks of running your company in chapter 21, “The Closing Day and Beyond.”