Get your business exit ready to maximise value

14 July 2025 / Insight posted in Enterprise series, Webinars

We recently hosted a webinar chaired by Esther Carder, Partner, with expert insights from our partners Nick Thompson (Head of Corporate Finance), Mike Orton (Partner – Transaction Services) and David Coates (Partner – M&A Tax). The panel discussed the current M&A landscape, key market drivers, exit strategies, and the importance of early preparation to maximise value. They also shared practical tips for a successful exit.

Key takeaways from the session

The M&A market experienced a buoyant period post-Covid but saw a slowdown in Q1 due to uncertainty. Being prepared for an exit is vital and quieter M&A periods are ideal for focusing on making the business attractive.

Adopt a buyer’s mindset early in the process, considering how business decisions and documentation, including remuneration structures, will be perceived by a potential acquirer. Undertaking corporate restructuring such as carving out irrelevant assets or group entities well in advance of a sale will avoid rushed decisions and complications at the deal stage.

Businesses are valued on a multiple of profit, influenced by factors such as profit maximisation, reducing owner dependence, having a diverse customer base, strong talent management, and robust financial controls.

Poor financial information is the primary reason for value reduction or price adjustments post-agreement, as buyers expect high-quality, detailed data, including client breakdowns and churn, which goes beyond standard audits.

Many businesses lack the granular data, such as client revenue breakdowns, and proper reconciliation with financial statements, leading to uncertainty during due diligence. A prepared data room containing core information like management accounts, reconciliations, statutory accounts, stock listings, and customer data provides a significant advantage by preventing delays and negative perceptions.

Buyers typically want to review two to three years of historic performance to understand underlying profitability and similar periods for future projections, which should be underpinned by realistic assumptions.

Tax changes, including national insurance increases and capital gains tax adjustments significantly influence the M&A market and business valuations, as they directly impact profitability and the cash retained by sellers.

Utilise equity incentives, such as EMI schemes, to engage and align employees with the company’s vision for an exit.

Many problems in financial due diligence stem from blurred lines between business and personal funds, and poor corporate hygiene practices, such as inadequate documentation of dividends or contractor engagements.