How Long Does an M&A Deal Really Take?

The timeline for completing an M&A deal can vary depending on a range of factors, but one thing is for sure: it takes time. On average, most deals take 12 months to close, and there are several stages to expect along the way.???

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In some cases, sellers face tight timelines to meet their objectives. At Chapman Associates, we’re proud to say that when deadlines are tight, we’ve successfully closed deals in under 60 days from authorization to completion.??

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Preparation Phase (1-3 months)??

The first step in any M&A transaction is preparing your business for sale. This stage is all about getting your financials, legal documents, and operations in order.???

Expect to:??

• Conduct a business valuation??
• Clean up financial statements and address any discrepancies??
• Prepare a comprehensive information packet for potential buyers??

This phase is critical for ensuring the business is attractive to buyers and is often much more intensive than the seller imagines.???

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Marketing & Search for Buyers (3-6 months)??

Once you're ready, we start actively marketing the business and searching for the right buyers. This involves:??

• Identifying and targeting potential buyers (strategic, financial, etc.)??
• Creating marketing materials and presenting the opportunity to the right candidates??
• Reaching out to potential buyers through direct outreach or listing on platforms??

For most deals, this phase is where the timeline can really stretch, as finding the right buyer may take time, especially if you're looking for a strategic fit or a higher-value offer.??

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Buy Side Due Diligence (3-4 months)??

After identifying a buyer, the due diligence process begins. This phase often feels like the longest part of the deal, as it involves:??

• Detailed financial review, including historical financials, projections, and tax returns??
• Legal and regulatory checks, including contracts, employee agreements, and any potential liabilities??
• Operational audits, to ensure everything is in place from a business operations standpoint??

Buyers will typically ask for several rounds of information, and addressing these requests can take several months. Be prepared for back-and-forth negotiations during this stage.??

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Negotiation & Final Agreement (1-2 months)??

Once due diligence is complete, the negotiations begin. This phase involves:??

• Structuring the deal (e.g., cash vs. stock, earnouts, and contingencies)??
• Finalizing terms and addressing any last-minute concerns??
• Drafting and reviewing the letter of intent (LOI) and purchase agreement??

Though it seems straightforward, this phase can still take time as both parties may go through multiple rounds of back-and-forth to reach a final agreement.??

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Closing & Transition (1-2 months)??

The final phase involves the actual closing of the deal, which includes:??

• Finalizing the paperwork and receiving regulatory approvals (if necessary)??
• Transitioning operations to the new ownership, including handling employees, customers, and vendors??
• Post-closing support, where the seller may stay on for a transition period to ensure smooth operations??al is signed, the work isn’t over – transition planning is a key part of ensuring long-term success.??

On average, the full M&A process takes about 12 months from start to finish, though larger or more complex deals may extend beyond this timeline. It’s important to note that many of these phases can overlap, with each playing a crucial role in the overall success of the transaction.??

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If you want to better understand how to prepare for the first step, reach out to us for a checklist outlining what buyers typically look for before making an offer.??

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