Founders often make this mistake in the excitement of signing an LOI:
Neglecting the buyer’s final M&A approval process.
I recently spoke with a founder who signed an LOI with a large strategic buyer.
He thought the transaction close was imminent.
But he overlooked the buyer’s final process post-LOI.
He missed that an M&A committee approval was needed to close the deal.
And that was where everything fell apart.
Key Takeaway
Ask the buyer to map out their entire M&A approval process post-LOI to close.
This is particularly important with larger companies with more stakeholders and complex processes.
Be mindful of any process dependencies (e.g., committees) where you lack relationships.
