What does a buy-side M&A adviser do?

A buy-side M&A adviser works for the business that is buying. If you run an established UK company and want to grow by buying another one, their job is to help you buy the right business, at a price you can defend, without the deal taking over your week.

That covers five things: helping you decide what to buy and why, finding the businesses worth a conversation, checking them before you commit, supporting you on price and terms, and coordinating everyone else through to completion. The adviser does this within a scope you agree at the start. You make every decision.

What does a buy-side adviser actually do?

Helps you decide what to buy

Before anyone is approached, a good adviser asks why you want to buy rather than grow organically, what the business must add, and what would make you walk away. The answer is your acquisition thesis: what you want to buy and why, written down. It is the brief everything else works from.

Finds the businesses worth a conversation

This is deal origination: finding the right businesses to buy, including ones that are not for sale. The adviser researches the market against your criteria, agrees a list with you, then approaches owners in confidence. Many owners will talk more openly to an independent adviser than to a competitor calling out of the blue. Our guide to deal origination explains the stages.

Checks them before you spend real money

Before you meet an owner, the adviser should already know the basics: what the business does, who owns it, what the filed accounts show and do not show, and whether it fits. After the first conversations, they help you separate a good business from a good story. That saves your time and your legal fees.

Supports you on price and terms

The adviser forms an independent view of what the business is worth to a buyer, and what it is worth to you specifically. They help you structure an offer (cash now, paying in stages, or an earn-out, which means paying part of the price later if the business delivers) and agree the price and main terms in writing, known as heads of terms.

Coordinates the deal to completion

Your accountants and solicitors carry out due diligence and draft the legal documents. The adviser scopes that work, keeps it to time, and makes sure findings are weighed against your original reasons for buying, not explained away because everyone is tired and wants to finish.

How is this different from a broker, lawyer or accountant?

Each role is useful. They answer to different people and do different jobs.

A seller's broker is doing exactly what they are paid to do: representing the seller well. Many good businesses are bought through brokers. The difference is simply whose interests each adviser is there to protect. Our guide to buy-side advisers and business brokers covers this in more detail.

Who does what in a typical acquisition?

This example is illustrative and fictional. The business, figures and timings are made up to show the roles, not to predict any deal.

The buyer: a £22m turnover fire and security company in the North of England. The founder wants regional maintenance businesses in the Midlands to serve national customers. There is no in-house deal team and the finance director is already stretched.

The pattern matters more than the detail. You stay in charge of the decisions. The adviser carries the work between them and keeps the specialists pointed at the same goal. Bringing the two businesses together without losing people or customers (integration) starts being planned well before completion; see our integration guide.

What should you ask before appointing one?

Use these questions in a first meeting. A good adviser will answer each one plainly.

Scope - What exactly will you do, and what will I receive at each stage? - Where does your work stop, and who picks it up from there? - Who will actually do the work day to day?

Conflicts - Do you ever act for sellers? If so, how do you handle a conflict in my sector? - Will you work for a competitor looking at the same businesses at the same time?

Evidence - Which acquisitions like mine have you worked on, and in what role? - Can you walk me through one in detail, including what went wrong?

Fees - How are you paid: a fixed fee, a monthly fee, a fee on completion, or a mix? - What do I receive for each part of the fee, and by when? - Does your fee rise if I pay a higher price, and how do you guard against that? - What is excluded? Legal and accounting work is normally paid separately.

Our guide to buy-side adviser fees explains the common models and the trade-offs between them.

Your input - How much of my time, and my finance director's time, will this need each month? - Which decisions will you need from me, and how quickly?

An adviser can only work to the brief you give them. If you can set aside an hour a week and make decisions promptly, the work moves. If you cannot, say so at the start; it changes what kind of help makes sense. Our guide to management time in an acquisition sets out what to expect.

When might you not need one?

Not every deal needs a buy-side adviser. If you already know the business, the owner has approached you, the deal is small and simple, and you have done this before, a good accountant and solicitor may be all you need.

An adviser tends to add most when:

• you do not know which businesses to approach, or the right ones are not for sale;
• you have not bought a business before, or not recently;
• you and your finance director cannot spare the time to run the process;
• you want someone independent to challenge the deal before you commit.

Which kind of help fits you?

Buy-side help comes in different shapes. Some owners need a defined piece of work: finding and approaching the right businesses, with a clear end point. Others want an acquisition team on call month after month, running the search, the pipeline and live deals while they run the company. You can compare our services side by side.

Michael Ferguson, who leads Acquisitiv, works only for buyers. He was previously head of M&A at one of the world's largest family-owned spirits companies and a finance director at a FTSE-listed company, and is a Partner at CDI Global in the UK. Examples of the kind of work involved are on our case studies page.

A sensible first step

If you are weighing up whether to buy, and what help you would need, a short conversation usually clears it up. Book an Expansion Briefing: a free 30-minute call with us about what you want to buy and whether acquisition makes sense now, followed by a short written summary and a recommended next step.