For many years, acquisition brokers were corporate moguls with deep pockets who had little concern for the small business entrepreneur who often did not have the resources to pursue his dreams. These Acquiry brokers often focused on buying up businesses at prices well above fair market value and using a small number of corporate buying and selling leverage to extract wealth from their less fortunate clients. Today, acquisition brokers work with a more varied clientele. They are now among the most valuable business assets, assisting entrepreneurs and small businesses in order to achieve and realize their financial goals and objectives.
Acquisition brokers assist businesses in the purchase of qualified, working capital, and/or business assets such as land, property, plant, equipment, tenant furnishings, goodwill, and patents. Capital acquiring brokers (CABs), also referred to as commercial mortgage brokers, act as financial transaction mediators between buyers and sellers. Capital buying is the process of buying or acquiring the whole or a part of a business. Acquiring brokers have a wide range of experience in dealing with a variety of business transactions. They are not limited to only working in the commercial sector. Many CPAs work with corporations, mergers and acquisitions, private equity, investment banking, and technology companies.
Acquisitions are made on the basis of cash flow, financial statements, proven track records, a thorough analysis of the buying candidates’ management teams, and analysis of the seller’s business plan and market conditions. One of the biggest benefits of hiring an Acquisition Broker is the ability to obtain information at a price that is below market value. These transactions-based compensation packages for CPA’s are designed to attract the best talent and to reward those with significant experience, leadership skills, management skills, and proven track records. In addition, as a private equity business owner, you will receive full disclosure of the individual compensation package for the entire company, not just those CPA IAs which directly affects your transaction-based compensation.
Acquisition brokers are responsible for performing many tasks to help businesses successfully close deals. They are usually the lead broker on communications between buyers and sellers, acting as the first line of communication between potential partners. They also perform due diligence on the sellers, conducting interviews, financial and credit checks, and evaluating the business’s financials. They may also be asked to review bidding strategies, bid price, offer terms, and other standard contracts to ensure that the transaction is fair and appropriate to the needs of both buyers and sellers. These professionals are highly skilled in finding profitable deal opportunities, negotiating for the seller, analyzing the financial statements of both the buyer and seller, negotiating the purchase price with contract provisions for a maximum return, and providing ongoing after sales service.
Depending on their experience, acquisition brokers may not work with the seller or the buyer to close the deal. In some cases, they may work in tandem with a buyer or seller, advising both parties of all the relevant information regarding the offering, working in coordination with legal and financial experts, providing inside information on the various aspects of capital acquisition transactions, and advising on related government agencies and regulatory policies. If they are working with a vendor, they may act as an intermediary between the vendor and the underwriter, acting as the buyer’s counsel, processing the sale and distributing appropriate documents required for closing the deal. If working independently, they may also work as an advisor or provide advisory services to sellers, helping them develop an appropriate course of action to successfully complete the deal.
Many businesses use acquisition brokers to execute their portfolio transactions. In doing so, they are using a seasoned professional to help them achieve their business objectives by facilitating transactions, providing advice on market trends, assisting with transactional strategies, negotiating contracts, reviewing equity and debt relationships, and providing key support throughout the transaction. While these professionals have years of experience in the industry and have developed skills and expertise in key areas, blackstreet capital management consultants are expected to have an overall understanding of the securities laws and related technicalities, as well as understand the process of buying and selling securities. Brokerage firms are expected to have sound experience in the securities laws as well as having solid experience in completing investment projects, servicing their clients, handling litigation, and tracking their portfolio investments. This combination of skills and expertise will ensure your success as an investor.