You're a consultant appointed by medium sized company with 20 employees and not much cash. Although the company has over 30 years of profitable operations, they express interest in buying one of their component suppliers. The component supplier is roughly the same size of company, has regarding the same number of employees, but has little more cash on hand. Further, the component supplier is family operated business with two shareholders which would like to become managers after acquisition.
Discuss what you would discuss with your client throughout the initial due diligence meeting.
What would you tell them regarding a potential deal structure? Additionally, which would you recommend-a merger or a consolidation? Give reasons.