If you are an owner of an electronic security business who is starting to think about selling your company now or at some point in the future, you are probably wondering what that process looks like and where to start.
We can help you get started.
Step 1: Reach out to us! During an introduction call, we would like to get to know each other and discuss your business and goals. If there is mutual interest after our introduction call, we typically proceed to signing a Non-Disclosure Agreement (NDA). Signing an NDA allows us to discuss details about your business in a confidential and proprietary manner. To complete our initial assessment of your business, we will need to discuss the following information: general business overview, general overview of your customer base, your employees, equipment you install for customers, and general overview of financials.
Step 2: Letter of Intent. Upon review of your business information, if a transaction seems that it would be mutually beneficial for both parties, we will submit a non-binding Letter of Intent (LOI). The purpose of this document is to set forth the most important financial and business terms in the proposed transaction. This document typically outlines the deal structure, purchase price, employee agreements, exclusivity, transaction timeline and other key provisions.
Step 3: Due Diligence. After the LOI is signed, we formally kick off the due diligence process. Due diligence is a more comprehensive review and “deeper dive” into your company's operations, financials, employees and processes. The duration of the due diligence process depends on the timeliness and quality of information from the seller. Depending on size and complexity, the due diligence process typically takes between four to six weeks.
Step 4: Purchase Agreement. Shortly after due diligence begins, we will provide the initial copy of the definitive agreement which governs the purchase of your business. Vector Security prefers to use an Asset Purchase Agreement, which sets forth what is included in the purchase and what is excluded. We openly discuss your questions and any proposed changes to the agreement.
Step 5: Closing. Once due diligence is completed and the purchase agreement solidified, we proceed to closing activities and dispersing funds to the seller.
The overall process timeline varies and is based on a number of factors, but a typical transaction can be completed within 90 days from initial conversations to closing.
Hello! My name is Ryan Dreliszak, and I am the Director of Mergers & Acquisitions for Vector Security. We have a long history of acquiring companies and accounts over the past 30 years. We are in the market to add to our growing business. Let’s talk if you have any questions or would like to further discuss your business with me!
