When a Buyer Calls…Be Ready!
By Paul Martin, PT, MPT, CBI, M&AMI
If you are a formidable rehabilitation company, and in a good market, you can expect that you will receive calls from all or most of the acquirers in this industry. Whether or not you are considering a sale or partnership opportunity for your company, you must be ready for that inevitable call. As in life and business, you only have one chance to make a great first impression, so do not miss your chance! Here are some tips on how to best handle that call.
When You Are Ready to Sell
There is nothing more impressive than a business owner who really knows his/her company. Confidently responding to questions with general answers about your market and your company will impact an acquirer. While being careful not to reveal too much about your company, discuss some of your metrics and give the acquirer a general idea of your size and scope of coverage in your market if asked. At the same time, know who you are talking to and do not give information that will offer anyone a competitive advantage in your market, such as key referral sources, hospital relationships, payer contract information, and profit and loss. Talk to the buyer in generalities and keep key information close to your vest.
Know Your Plan
If your plan is to continue to grow (which makes a lot of sense in the current environment), talk to the acquirer generally of your growth plans. Buyers are seeking companies that have the ability to grow. Providing a general overview of your plan will further entice a buyer’s interest.
Be Professional
This may be a pet peeve of mine, but, whatever you do, do not tell the acquirer that “for the right price, anything is for sale!” Acquirers will immediately see those kinds of statements as unprofessional and uninformed. The acquirer should know that when you are ready to initiate the sale process, you will fully understand the value of your company and will run a professional process to make sure that you get the best available deal in the market.
Do Not Get Trapped
To execute a sale and/or partnership opportunity for your company, you must run a professional process. By doing so, you place all of the potential acquirers on the same starting line, at the same time, and they will all see the same information on a confidential basis. That is the only way to get your best deal. Be courteous and professional, but politely explain to an acquirer that you plan to run a professional process for your business. It is only then that they will see all of your important information under strict confidentiality. Do not make the mistake of going down the road with any acquirer until you are fully prepared with your team. You only have one chance to make a first impression.
Assemble Your Team
If you decide that you want to pursue an acquisition, assemble a professional team to guide you through the process. Your team will consist of a mergers and acquisitions advisor, an accountant, and an attorney. All of these professionals should have experience in mergers and acquisitions as well as the rehabilitation industry. The best acquirers appreciate a professional team sitting across from them as you both navigate through this process.
Paul Martin, PT, MPT, CBI,M&AMI president of Martin Healthcare Advisors, is a nationally recognized expert on health care business development and succession planning. As a consultant, mentor, and speaker, Paul assists business owners with building value in their companies. He has authored The Ultimate Success Guide, numerous industry articles, and weekly Friday Morning Moments. He can be reached at pmartin@martinhealthcareadvisors.com.