Auction Process (Competitive Bidding)

The auction process is a central component of a structured M&A process, in which several potential buyers are approached in parallel and invited, in defined phases, to submit offers. The aim is to create competition between the bidders in order to optimise the purchase price and the contractual terms for the seller.

Typical phases are distribution of the teaser, agreeing the NDA, distribution of an information memorandum, obtaining indicative offers, management meetings, due diligence and final offers or term sheets. Process management — in particular the competitive dynamic, timing and the staggered release of information — is decisive for the outcome. An overview of the M&A process as a whole can be found, for example, here.