Structuring deals that maximise value and actually close
Why smart deal structuring is the difference between a good exit and a great one
In today’s buoyant M&A environment, especially in Australia where inbound deal activity has surged to near-record highs in 2025, founders have a rare window to capture premium valuations. But as Sean Steele rightly asked: “What do founders need to know about deal value and structuring to get a great outcome?”
The answer lies in preparation, positioning, and precision. Too many founders leave value on the table because they don’t understand how buyers assess future potential, or how deal terms can erode value post-offer. At Morgan Shaw Advisory, we believe that the best deals are built years before you sell. And when it’s time to transact, structure is everything.
Why this matters now
Australia’s mid-market is buzzing. With over USD 19.6 billion in inbound M&A across 160 deals so far this year, buyers from Japan, the US, and Europe are targeting resilient sectors like tech, insurance, and cyber risk. Private equity is doubling down on governance and compliance platforms, and niche verticals like fintech and subsea services are attracting premium multiples.
For SME founders, this means two things:
Buyers are paying for future growth, not just historical performance.
Deal terms not just price are increasingly decisive in determining real value.
What drives valuation (and what doesn’t)
Forget the simplistic EBITDA multiple. Buyers are looking for:
Defensible, durable growth: Evidence of multiple growth engines: pipeline, backlog, signed contracts.
High-quality revenue: Recurring, contracted, low churn, diversified, with no single client >15–20%.
Strong market position: #1 or #2 in a niche, with clear barriers to entry.
Embedded tech/IP: Not just buzzwords, but real tech that drives scale or defensibility.
Sticky, high-calibre customers: Blue-chip logos, long relationships, strong NPS.
Favourable sector dynamics: Tailwinds matter, distressed sectors don’t.
These fundamentals set the stage. But it’s the deal structure that determines whether you actually realise that value.
Deal structuring: the real value lever
From our advisory work and internal frameworks, here’s what we see as the most effective structuring principles:
1. Maximise cash at completion
Buyers may push for earn-outs or deferred payments. Sellers should negotiate for the highest possible upfront cash component to reduce risk and lock in value.
2. Avoid performance-based earn-outs
Where possible, replace performance-based deferred payments with guaranteed deferred payments tied to time, not targets. This reduces post-deal friction and protects seller upside.
3. Balance warranties and indemnities
Don’t let buyers load the deal with one-sided protections. Ensure warranties are reasonable and indemnities are capped and time-limited.
4. Secure vendor finance
If vendor finance is part of the deal, ensure it’s properly secured, ideally with personal guarantees or asset-backed instruments.
5. Understand share vs asset sale implications
Tax, liability, and continuity all hinge on this distinction. Get expert advice early to structure the deal in your favour.
6. Run a tight timeline
Deals that drag lose momentum. Set clear milestones and deadlines to avoid fatigue and slippage.
MSA’s approach: bridging the gap with EBITDA+ SIX STEPS TO SUCCESS™
At Morgan Shaw Advisory, we don’t just advise on transactions, we help founders build value long before the sale. Our EBITDA+ SIX STEPS TO SUCCESS™ framework focuses on:
Strategic planning and exit readiness
Operational improvements and tech enablement
Revenue diversification and customer quality
Market positioning and competitive moat
Deal structuring and negotiation strategy
Post-deal transition and legacy planning
As highlighted in our internal papers, the negotiation is not the main event, it’s the culmination of preparation. A well-prepared business commands respect, reduces buyer risk, and closes faster.
Key takeaways for founders
Start preparing 12–24 months before exit.
Focus on future value, not just past performance.
Structure the deal to protect your upside.
Don’t negotiate alone, use expert advisors.
Be strategic, not reactive.
Ready to maximise your exit?
If you’re considering a sale in the next 12–24 months, now is the time to act. Book a confidential consult with Morgan Shaw Advisory, explore our EBITDA+ SIX STEPS TO SUCCESS™, or read more on our resources page.