Walk me through a sell-side M&A process.

A sell-side process is how a bank runs the sale of a company for its owners. I'd describe it in five stages. First, preparation. The bank agrees the plan with the seller. It builds a list of likely buyers, both strategic and financial. It writes the marketing materials, which are a short teaser that doesn't name the company and a detailed confidential information memorandum. Second, marketing. The bank sends the teaser to buyers. Those who are interested sign a confidentiality agreement and then receive the memorandum. Third, first-round bids. Buyers submit non-binding indications of interest with a price range. The bank and seller pick a shortlist. Fourth, the second round. Shortlisted buyers get management presentations and access to the data room for due diligence. They then submit final, binding bids with a marked-up purchase agreement. Fifth, negotiation and closing. The seller picks a winner, negotiates the final agreement and signs. Closing comes later, after regulatory approvals and any shareholder vote.

A sell-side process is how a bank runs the sale of a company for its owners. A broad auction usually takes several months. I'd describe it in five stages. First, preparation. The bank agrees the plan with the seller and values the company so the seller's price expectations are realistic. It builds a list of likely buyers, both strategic and financial. It writes the marketing materials, which are a short teaser that doesn't name the company and a detailed confidential information memorandum. The analyst builds the model, drafts pages of the memorandum and researches buyers. Second, marketing. The bank sends the teaser to buyers. Those who are interested sign a confidentiality agreement and then receive the memorandum. With it comes a process letter that says what to bid and by when. The analyst keeps the buyer log, tracking who has signed and who has received what. Third, first-round bids. Buyers submit non-binding indications of interest with a price range. The bank and seller pick a shortlist. The analyst lays the bids out side by side on price, financing and conditions. Fourth, the second round. Shortlisted buyers get management presentations and access to the data room for due diligence. They then submit final, binding bids with a marked-up purchase agreement. The analyst runs the data room and chases answers to diligence questions. Fifth, negotiation and closing. The seller picks a winner, negotiates the final agreement and signs. Closing comes later, after regulatory approvals and any shareholder vote. Two points of judgment. The best bid isn't always the highest price, because certainty of closing matters too. And a broad auction isn't the only format. A seller worried about confidentiality may approach only a handful of buyers.