Completing a merger. Acquiring or selling a business. These are complex, stressful deals with dramatic impact on how your company goes forward. Buyers need to ensure target firms fit their strategy, are reasonably priced, and will integrate effectively. Sellers focus on getting the best possible price — and managing the business through transition. CohnReznick's Transaction Advisory Practice provides the due diligence, acquisition integration, and other advisory services to assess risks and rewards and navigate transaction intricacies.
Preparing your company for sale or acquiring another business — and then strategically moving your company forward – is critical. With experience across a range of high-profile transactions, CohnReznick can assume the role of strategic advisor so that you can focus on decision-making. Our services include management recruiting, product and market strategy, forming strategic alliances, identifying acquisition targets, executing divestitures, and fine-tuning your corporate finance strategy.
DEAL SOURCING AND PRE-TRANSACTION SERVICES
How do you find the right acquisition candidate or strategic acquirer? CohnReznick provides you with access to a network of over 1,000 owner-operated companies that we advise. We also assist both buyers and sellers before the transaction — for sellers providing analysis of appropriate valuation, market conditions, and potential acquirers and for buyers validating pricing, business strategy, and integration prospects.
Whether on the buy-side or sell-side, understanding the potential risks and rewards of a transaction takes many forms. Our expert transaction advisors will assess your acquisition or sale across the spectrum of analysis:
Financial due diligenceAssessment of cash flows, working capital, historical performance, quality of earnings, key business drivers, potential risks, unseen liabilities and costs and operational weaknesses
Financial due diligence for special situationsKnowledgeable review of distressed companies via collaboration with our bankruptcy and restructuring practice to preserve going-concern value
Human capital due diligenceExtensive strategic review of cultural fit of employees, health and welfare programs, retirement plans, compensation structures, benefits and labor contracts, and underlying costs
Information technology due diligenceIdentify IT-related risks while finding opportunities to reduce costs and increase efficiency
Sell-side due diligencePre-emptively uncover issues and reduce the impact of unexpected findings that can derail transactions or depress the purchase price
Tax due diligenceMinimize tax burden and maximize returns by identifying alternative deal structures, planning opportunities, and potential tax risk, and evaluate possible tax attributes, credits, and incentives
The success of your transaction depends on more than what you buy or how much you pay. Success is also determined on how well you integrate a new company into your existing operation. This integration may be complex involving financial planning, systems, product alignment, process optimization, distribution and manufacturing, employee and divisional restructuring and cultural change, to name a few. CohnReznick offers a full-range of advisory and technical expertise to plan and operationalize the integration.
SALE AND PURCHASE AGREEMENT (SPA) ADVISORY
Purchase price adjustments defined in the SPA can significantly impact the economic success of a deal. As deals become increasingly complex, it is critical that both buyers and sellers think strategically about value that can be gained or lost during SPA negotiations.
Our dedicated team works with clients and their advisors to help ensure the SPA reflects the outcome of due diligence and key commercial negotiations in order to maximize value and reduce the likelihood of post-closing disputes. We have deep knowledge across a variety of industry sectors and provide market-focused insight to help our clients achieve a favorable position during the negotiating process.
We strategically assist clients across the lifecycle of a deal:
- Advise on the appropriate pricing mechanism
- Review and advise on the key accounting and financial definitions in the SPA (e.g., cash, indebtedness, working capital)
- Address financial matters identified during due diligence
- Prepare or advise on the governing accounting principles
- Form a position on target working capital
- Review and advise on financial representations and warranties
- Advise during commercial negotiations with the other party
- Consider implications of carve-outs and restructuring
PREPARATION OF CLOSING ACCOUNTS
Our team routinely supports clients through the purchase price adjustment process after signing, and through closing and post-closing. We can prepare or provide guidance on the estimated closing statements, adjusted closing balance sheet/closing statements, and funds flow in accordance with the SPA and agreed accounting principles.
PURCHASE PRICE DISPUTES
Post-acquisition, buyers and sellers may not agree on the governing accounting principles, policies, practices, and procedures that should be applied to arrive at a purchase price adjustment. CohnReznick professionals use their accounting/GAAP expertise, transaction experience, and dispute resolution skills to advise clients in negotiating post-acquisition purchase price issues related to working capital adjustments, earn-out disputes, and indemnification claims. We offer innovative solutions and deep expertise to resolve disputes from the viewpoint of the buyer, seller, or, as required, act as a neutral third-party arbitrator.
OUR SERVICES INCLUDE:
- Assessment of the consistent application of the provisions of the purchase agreement, including governing accounting principles and/or GAAP
- Preparation and/or review of closing statements
- Assisting the seller in preparing its notice of disagreement
- Assisting parties during the good faith negotiation period to settle adjustments to the closing statement prior to dispute
- Assisting buyers or sellers in preparing submissions to a neutral accounting arbitrator
- Neutral arbitrator/independent accountant services
- Earn-out disagreement resolution
- Leakage review
- Breach of representations and warranty claims
- Determination of potential economic damages
- Allocation of purchase price for optimized tax environment
- Choose one
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