Edit ModuleShow Tags
Edit ModuleShow Tags

Ship-Shape Documents a Must to Smooth M&A


Published:

 

Franchise systems that fail to collect and store all their documents in an electronic database aren’t merely disorganized—they also may lose the deal altogether when a potential buyer comes to look at their firm.

 So said a panel today covering due diligence during franchise mergers & acquisitions, at the International Franchise Association’s Legal Symposium in Chicago, which runs through May 6.

“You have to keep in mind that the due diligence process is a job interview for the general counsel, because we want to have top-tier management,” said Jeremy Holland with The Riverside Company, a private equity firm that buys growing concepts under $250 million in revenue. “You’re being evaluated, all of senior management is being evaluated. We want people that run a tight ship.”

Gaylen Knack of Gray Plant Mooty, moderator of the panel, said a deal recently fell through for a disorganized buyer, and Holland added oftentimes the price offered will decline. “You’re not changing your price because of disorganization, but because of exposure” to risks that can’t be answered by a thorough document review, Holland said.

Grayson Brown is senior corporate counsel for TBC Corp., which franchises Big O Tires and Midas, among other brands. “You need to help the franchisor have a system and procedure, to have everything in order,” he said. “I do an annual review” of all documents in the system, “because you have to be ready for a transaction on a moment’s notice.”

Edit Module
Edit ModuleShow Tags

Add your comment:
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit ModuleShow Tags


Covers everything from good news to bad judgment

About This Blog

The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Tom KaiserTom Kaiser is associate editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
 
Beth EwenBeth Ewen is editor-in-chief of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is staff writer at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonLaura Michaels is managing editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 
Nancy WeingartnerNancy Weingartner is editor-at-large of Franchise Times magazine and the editor of the Food On Demand media project. You can reach her at 612-767-3200 or at nancyw@franchisetimes.com.
Follow her on Twitter at http://twitter.com/nanweingartner.
 

Archives

Categories

Feed

Atom Feed Subscribe to the Franchise Times News Feed »

Recent Posts