Getting ready for a business transition
Business Owner Strategic Services
At Bank of America, we understand the challenges and complexities of designing and implementing a business transition plan that meets your priorities. Whether you envision a sale, a restructure, an initial public offering (IPO) or equity private placement, our dedicated teams of specialists provide integrated advice, from early-stage review of your strategic alternatives and transaction planning, to the actual deal negotiation and execution, to post-sale tax and investment considerations.
Our suite of services encompasses three key areas: pre-transaction business planning, pre-transaction personal planning and investment banking.
Pre-transaction business planning1, 2 |
Pre-transaction personal planning1 |
Investment banking2, 3 |
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Business planning1, 2
Taking the time to prepare your business for a transition can help you maximize your company’s value and choose the path that meets your priorities. Bank of America can help you in the following ways:
Review of strategic alternatives. The process of executing a transaction can take several forms. Each has unique consequences, such as income tax treatment and liability exposure. At Bank of America, we can help you determine which method suits your needs. By distilling your business and personal goals and identifying important consequences of each transaction, we can help you determine which option, whether it be an ESOP, IPO, intergenerational transfer or a sale to a third party, will help you achieve your goals.
Transferability of value. Maintaining your company’s transactional value may be predicated on outcomes for key employees, contracts with major clients, the quality of your earnings, title issues, and tangible and intangible assets. Your Bank of America team can help you by providing transactional and industry expertise that works to address value-enhancing opportunities so you can preserve your company’s value and mission.
Internal and external deal teams. Transitioning your company can be a daunting and time-consuming task. Having the right advisors supporting you can make the process not only easier but more lucrative. Internally, it’s important to establish a key leadership team of individuals who have clear roles and hold critical information. Externally, an M&A advisor, transactional attorney, accountant and appraisal firm all have important parts to play. At Bank of America, we’ll work closely with your management team and your third- party advisors.
Transaction process guidance. Making sure you have all necessary documentation and assets in order is critical to completing a successful transaction. This can include making sure that financial statements are reviewed and audited, removing obsolete and non-business assets, and settling contingent liabilities such as litigation. Your Private Bank team can help you and your legal/tax advisors determine which approach is suited to your goals. For example, an unexpected offer or beneficial timing, and helping you realize your preferred transaction.
Personal planning1
The future impact of estate taxes and how wealth will affect your family are important yet often overlooked considerations before the sale of a business.
Through Private Bank’s trust and estate planning, cash flow modeling, pre-sale liquidity planning, and philanthropic and family office services, we can help you achieve your personal and legacy goals.
Cash flow modeling. Your current and desired lifestyles are critical in assessing how much you’ll need for you, your family and any charitable causes you support. Our proprietary cash flow analysis sheds light on the impact of different choices, as well as your long-term cash needs, and may help you assess the right sale price for your company.
Trust and estate planning. If you’re interested in preserving your wealth for the next generation, it’s critical to address estate planning well before a liquidity event. Your Private Bank team can analyze the particulars of the sale and your family goals and prepare a personalized strategy — which may include a gift or sale of a portion of your business and a discounted value to a multigenerational family trust, a grantor retained annuity trust (GRAT), or other family structure. We’ll also work with you to educate your family on the impact of your planning decisions and help them adjust to a new reality.
Pre-sale liquidity planning. While a higher sale price may be your initial goal, the entity, timing of sale proceeds and sale structure will all affect your tax liability and how much you ultimately walk away with. We can help review deal structuring options, offer alternatives and assist you in taking the necessary steps to absorb the tax costs as efficiently as possible.
Philanthropic services. If charitable causes are important to you and your family, your Private Bank team can help integrate your philanthropic planning goals and provide scenarios that may lessen tax exposure while attaining your philanthropic objectives.
Investment banking2, 3
Whether you wish to sell your entire company, sell a minority share, raise equity capital or refinance your business, our team of experienced investment bankers at BofA Securities and our Private Sales Referral Network are here to help. Our BofA Securities team provides financial advice and assistance in connection with a potential transaction, including conducting financial analysis, coordinating with potential buyers and assisting in negotiating the financial aspects of your transaction. BofA Securities also offers equity capital market solutions, including as part of an IP0 or private placement. Our BofA Securities team’s deep industry knowledge and global reach will enable you to develop creative capital-raising solutions. BofA Securities’ range of investment banking services include:
- Mergers and acquisitions advisory services including sale of businesses
- Private capital raises
- Initial public offerings
- Debt financing and recapitalizations
Contact your advisor to learn more.
1 Services offered by Bank of America Private Bank.
2 Services offered by BofA Securities, Inc.
3 Private Sales Referral Network is specifically designed for clients with privately held companies that sit within the “Lower Middle Market” and are not a fit for our internal investment bank. These companies generally have trailing EBITDA of $2 million or more. Investment banking boutiques in the Private Sales Referral Network are registered broker-dealers with the SEC. Each operates independently, is not an agent of Bank of America, N.A., BofA Securities, Inc., and/or Merrill Lynch, Pierce, Fenner & Smith Incorporated, and will be the exclusive provider of investment banking services.Bank of America and its affiliates do not provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.
Always consult with your independent attorney, tax advisor, investment manager and insurance agent for final recommendations and before changing or implementing any financial, tax or estate planning strategy.
Bank of America Private Bank operates through Bank of America, N.A., and other subsidiaries of BofA Corp. Bank of America, N.A., and U.S. Trust Company of Delaware (collectively the “Bank”) do not serve in a fiduciary capacity with respect to all products or services. Fiduciary standards or fiduciary duties do not apply, for example, when the Bank is offering or providing credit solutions, banking, custody or brokerage products/services or referrals to other affiliates of the Bank.
“Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of BofA Corp. Lending, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of BofA Corp., including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of BofA Corp. (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc., and Merrill Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC and, in other jurisdictions, by locally registered entities. BofA Securities, Inc., and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA.
