Across Central Europe, a quiet wave of consolidation is under way. Investment groups and industry consolidators are buying dental clinics, IT firms, logistics companies, manufacturing businesses – and the founders who built these companies after 1990 are receiving letters, e-mails and phone calls with the same message: we would like to talk about acquiring your business.
If you own a company with revenues in the millions of euros, the call is not a question of whether. It is a question of when – and of what you do in the first fourteen days after it comes. In our experience, that is where sellers win or lose the most money, long before any lawyer or advisor sees the file.
The five mistakes owners make in the first two weeks
1. They answer the price question. The buyer’s first question is usually some version of “what would you expect?” Whatever number you say becomes the ceiling of the negotiation. Professional buyers ask it precisely because most owners answer it.
2. They negotiate alone. The person across the table buys companies for a living. You will sell one company, once. That asymmetry, not the price offered, is the real risk of an unsolicited approach.
3. They treat the letter of intent as “non-binding”. Most of an LOI is indeed non-binding. The exclusivity clause is not. Owners routinely sign away their negotiating leverage for six months in a document they were told was a formality.
4. They read the headline number as the real number. “We value your company at €4 million” can, after earn-out conditions, escrow holdbacks, working-capital adjustments and debt deductions, mean €2.5 million in your bank account – or less. The structure of an offer matters more than its headline.
5. They tell people at the wrong moment. Key employees, key customers, the bank – each has to learn about a possible sale at the right time and in the right way. A leak at the wrong moment weakens the company and the negotiation at once.
Why we are writing about this
The partners of our firm have spent decades advising on transactions – and have also stood on the seller’s side personally, having built and sold businesses of their own. That experience taught us something the legal profession rarely admits: by the time the contract reaches the lawyer, the most important decisions have usually already been made, and not always well.
That is why ULC Čarnogurský now offers owners of mid-sized companies a service that begins where it should begin – before the negotiation, not after it. A confidential second opinion on an offer you have received. A readiness review a year or two before you intend to sell. And, where wanted, management of the entire sale process at the owner’s side – for a transparent flat fee, not a success commission. We earn the same whether you sell or walk away; our only interest is that the outcome is right for you.
If the call has already come
Do not answer the price question. Do not sign anything, including “formalities”. And before you reply, talk to someone who has sat on your side of the table.
Contact us for a confidential consultation.
