Lessons Learnt

General preparation

  • Know your balance sheet
  • Maintain a “dataroom”
  • Keep your financial models up to date
  • Maintain / build a consolidated model with integrated P&L, balance sheet and Cash flow

Planning for a transaction - Proper planning works!

  • Don’t overpromise on timetables
  • Planning tools like MS Project are a great help but need very good technical knowledge and awareness to be effective.
  • Remember the transaction itself takes 3 – 6 months so resource properly – don’t rely on a Group Finance department staffed for ongoing reporting unless you’re happy to degrade the quality of that routine reporting (not recommended)

Project management

That regular formal meetings of management and advisers are beneficial but only when controlled properly i.e.
Minutes identifying action points are circulated quickly
Action points are followed up in between meetings
Project staff should be separate from those running the business to avoid either one of them suffering
Keep your advisers informed

Financial Modelling

  • Financial models will frequently need reviewing / extending / made more flexible (any working capital forecast will need at least 18 months which given the time for the transaction itself means 2 years)
  • You will frequently need a separate model for the capital structure. This must be prepared by someone with very good technical knowledge

Commercial issues are paramount

  • It is very difficult to forecast properly with material commercial issues outstanding
  • Forecasts must be properly validated before a financing strategy is developed
  • Be prepared for commercial counterparties to take you to the wire


  • Your lenders will probably need to consent to the transaction
  • If your facilities expire before the end of your working capital forecast period you may need to negotiate an extension
  • When negotiating facilities it’s worth ensuring that the expiry date is more than 16 months after your next period end to allow you to be able to meet the twelve month going concern horizon at the point you actually sign your accounts.

For a much more detailed review of the different aspects of a transaction, designed to help participants identify what their transaction is likely to involve and suggest how we can help with particular elements, click here.