Deal Team

A team of professionals who support the business owner in planning and executing a transaction

What is a Deal Team?

What is a deal team? Ownership transactions such as ESOPs, M&A, and recapitalizations are usually complex transactions that require the knowledge and skills of a wide range of professionals. A deal team needs to get all individual players contributing in the right measure and at the right time during the course of the deal process for it to be successful in executing and closing a transaction. The deal team’s ability to communicate and work together can dramatically influence the outcome of a transaction.


Deal Team


An efficiently functioning deal team supports the owner of the business in determining the goals and objectives of the transaction, organizing the transaction, planning and implementing the transaction process, and in forestalling and alleviating potential problems. If all factors are properly addressed, the result is usually a smooth, successful transaction.


Importance of a Deal Team

Business owners usually employ groups of advisors who offer consultation services to help deal with needs of the business or solve problems. These groups usually include attorneys and accountants, as well as other professionals. Additional expert knowledge is usually necessary for ownership transition transactions.

Business owners may need to search beyond their present advisory circle in order to find specialists with ownership transition know-how. Finding advisors with broad transaction experience, perfected by completing similar deals, is critical for the successful execution of such a transaction. The existing advisory group will often recommend professionals with applicable skills for such transactions.

In the process of putting together a specialized deal team, it is critical for the business owner to form a good relationship with all the professionals in order to develop trust and respect in the guidance they offer.

It is imperative that the responsibilities and roles of each individual on the deal team are defined clearly and communicated to other team members to ensure that all aspects of the transaction are covered and that the deal is completed smoothly. One member of the deal team, often an investment banker, acts as the team leader to manage use of resources and coordinate the whole transaction process.


Key Members of a Deal Team

An effective deal team for an ownership transaction needs to include, at minimum, experts from the following disciplines:


1. Investment Banker

An investment banker helps the business owner in company preparation, understanding transaction options, developing transaction positioning strategy, and generally manages the execution of the deal. The investment banker leads the whole deal team and works with all relevant parties to ensure that the transaction process is smooth.


2. Accountant

An accountant is often already among the advisory group of the business owner. Their role is usually to provide accounting and tax advice, which is important in the transaction planning stage. Good tax planning can positively influence the transaction and help to maximize profits.

Moreover, the company’s financial information quality can significantly affect the deal outcome. Additional accounting proficiency is often required in the process of auditing or inspecting the company’s financial statements, or in providing other forms of special analysis that will advance the deal process.


3. Wealth Manager or Advisor

A skillful wealth advisor is important in the planning stage to provide the business owner with advice on investment options, as well as to determine the least amount of profit that is required from the deal to sustain a desired lifestyle after the transition.


4. Attorney

An attorney will often also be an existing member of the business owner’s advisory group. The role of the attorney as a member of the deal team is to ensure that the legal records of the company are in perfect order for the transaction. Attorneys offer legal advice, as well as advice on tax matters in the transaction.

Employing a proficient deal lawyer who is conversant with financial and M&A transactions is important. In cases where the existing attorney lacks applicable experience, supplementary legal professionals can be sourced from another firm.


Other Members of the Advisory Team

Depending on circumstances of the deal, other advisory team members can be included in the deal team. For instance, consultants may be needed to provide advice for specific deal issues such as financing matters, real estate matters, and environmental situations.


Key Takeaways

For an ownership transaction to be completed successfully, an experienced deal team with varied skills and a cooperative work ethic is important. The advisory team members may include an investment banker, an accountant, an attorney, and a wealth manager. It is essential that the owner of the business is comfortable with all the deal team members and that their individual roles and responsibilities are understood and communicated clearly.

The expertise of the deal team will significantly influence the preparation, execution, and success of the transaction. Therefore, a business owner needs to build a strong deal team before starting an ownership transition transaction.


Additional Resources

CFI is the official provider of the global Financial Modeling & Valuation Analyst (FMVA)™ certification program, designed to help anyone become a world-class financial analyst. To keep advancing your career, the additional CFI resources below will be useful:

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