Growing through acquisition starts with finding a suitable target and holding a constructive first meeting. This article outlines a practical roadmap, from initial orientation to first contact.
Acquisitions are not reserved solely for large corporates with a corporate development department. SME business owners in the Eindhoven region also frequently opt for growth via acquisition, for instance to quickly gain market share, technology, or staff. Often, the main hurdle is not financing, but finding and approaching a suitable target.
This article describes a practical roadmap for identifying and approaching acquisition targets, and what you need in place beforehand. For acquisition funding, we refer to the acquisition financing page.
First gain clarity on your own acquisition strategy
Before starting an active search, it is worthwhile being clear on why you want to acquire and what type of company fits that goal. Are you looking for complementary technology, extra capacity, access to new clients, or primarily staff in a tight labour market? These motives strongly dictate which type of target makes sense.
Also establish your financial limits and what portion of the acquisition you can fund, for instance using the financing calculator. This prevents spending time in discussions with targets that ultimately fall outside your financial capacity.
Where to find targets
- Your own network: trade associations, suppliers, customers, and fellow business owners often know which companies are grappling with succession
- KVK and public company registers can help compile an initial longlist of businesses within a specific sector or region
- Brainport Development and regional business networks organise events where entrepreneurs and succession issues converge
- Acquisition brokers and M&A advisers typically maintain a portfolio of businesses that are (not yet openly) for sale
- Accountants and tax advisers in the region often have visibility of clients contemplating a sale or succession, though they will naturally handle this confidentially
The succession wave as an opportunity
In the Eindhoven region and across the wider Netherlands, a considerable proportion of family businesses is reaching a stage where the owner is ready for succession, yet not every company has a suitable internal successor. This makes acquisition a viable route for entrepreneurs looking to scale, provided they search in good time and with a well-defined profile.
KVK and RVO provide general information on business transfers that is also valuable for buyers to understand the seller's perspective, such as emotional and tax-related aspects of a handover.
Approaching a target: initial contact
An initial approach requires tact, particularly when a business is not openly up for sale. Asking bluntly whether the company is for sale can trigger a defensive reaction. It is often more effective to initiate discussions around a shared interest—such as collaboration, joint clients, or an exchange on the sector's future—and explore gently from there whether succession or an acquisition is open to discussion.
Approaching via an intermediary, such as an M&A adviser, allows anonymity to be preserved initially, which can be more comfortable for both parties at an early stage. This also avoids premature rumours causing unrest among the target's staff or clients.
What you must have in order beforehand
- A clear acquisition profile: sector, size, region, and the rationale behind the acquisition
- An indication of your own financial headroom and the type of financing you envision
- A non-disclosure agreement (NDA) ready to share as soon as discussions become more serious
- An internal understanding of who within your organisation is involved in the acquisition process and who makes the final decision
- Realistic expectations regarding lead times: an acquisition process often takes longer than initially assumed, partly due to emotional and tax considerations on the seller's side
From initial meeting to a concrete process
If an initial meeting goes well, it is typically followed by further introductory talks, in which both parties explore whether mutual trust and a shared vision exist. Only after that is a letter of intent usually agreed, followed by due diligence and structuring the deal and financing.
Engage an adviser for valuation and financing structure early during this stage, so you enter negotiations with a realistic view. See also the business valuation page for further details on how an indicative valuation is established.
Concrete next steps
- Formulate a clear acquisition profile covering sector, size, and rationale before actively looking
- Explore your own network, trade associations, and regional networks such as Brainport Development for initial leads
- Consider hiring an M&A adviser, particularly for a discreet initial approach
- Prepare a non-disclosure agreement and a clear financial framework before discussions become more serious
- Engage an adviser at an early stage for valuation and financing structure, for instance through a discussion on acquisition financing
Frequently asked questions
- How do I find an acquisition target that is not publicly for sale?
- Through your own network, trade bodies, regional networks such as Brainport Development, or via an M&A adviser who often has insight into companies considering succession without having announced it publicly.
- How do I approach a business without derailing the conversation straight away?
- Preferably open the conversation based on a shared interest, such as cooperation or a mutual industry challenge, and gently explore from there whether an acquisition or succession is on the table. An intermediary can assist in maintaining anonymity.
- On average, how long does it take for an acquisition process to result in a deal?
- This varies considerably by situation and depends partly on emotional and tax considerations on the seller's part. Allow for a longer lead time than initially anticipated, and build buffer room into your own planning.