Acquiring a business is much like buying a house: an often-exciting purchase that can nevertheless be fraught with difficulties foreseen and unforeseen.

There will often be complications that you might not have anticipated. Last year, my company, which trades under two brands, TopLine Comms and TopLine Film, decided to acquire a STEM-focused PR agency based in Reading.

The company had everything we were looking for: an experienced and skilled team, an impressive roster of clients, and an excellent reputation.

But it also presented some unique challenges. Here’s what I learned from TopLine’s first – and hopefully not last – acquisition.

Be clear about valuation

Valuation is less about the sum you’re offering than how you work out what the sum is. You need to be very clear with your target company about how you’re valuing them and why: is it a multiple of profit, or of revenue?

If the former, you’ll need to work out the real profit, which means removing exceptional expenses and adding in management salaries if the owners are paid in dividends.

The important thing is to make sure that what you’re offering is fair for the target company – and won’t put undue strain on your budget. Everyone needs to feel equally happy (or equally unhappy) with the deal.

Clarify the rules

It’s important that the seller and buyer are on the same page when it comes to what happens after the deal completes. The minute the contracts are exchanged, the seller gives up control of their business. That means they no longer have the authority to make many of the decisions they are used to making.

While their company credit card is technically still active, they can’t use it without the permission of the acquirer. While they still have keys to the office, the acquirer might not want them there.

Fortunately, in our case, the transition was handled relatively smoothly. However, I can see how this could cause a lot of friction!

Put people first

The first thing most people do when they hear their employer is being bought out is panic (whether they have reason to or not) and it’s important to defuse this tension at the first opportunity.

You’re acquiring a business, but you’re also acquiring a team of people. These people will inevitably have questions, and it’s important that you can give straight, comprehensive answers.

Once the initial panic has subsided, they’ll inevitably have some concerns: they’ll want to know where they will be working and how their role might change.

When we brought the two teams together we held a joint party to celebrate the acquisition and we created a mini-committee to answer any questions and ensure continued communication. These steps will help you get the merged team off to a flying start.

Whatever you do, follow the law: regulations are very clear on how employees should be treated in this scenario – and for good reason: employees’ rights need to be protected.

Consolidate your systems

An acquisition is an opportunity to look at your systems and processes – and improve them where you can. Your new team will have its own rhythms and preferences when it comes to how they work, and it’s worth accommodating them wherever you can.

But you might also see new opportunities in the transition process: if the acquired company is doing something better than you are, it’d be silly not to consider implementing it across the entire company. Whatever happens, expect it to be time-consuming – especially when it comes to finances.

Merging your accounts can be really tricky: you need to be sure that both businesses pay their taxes; that all invoices are sent from the correct account, chased, and paid; and obviously, that you pay the combined companies’ suppliers too.

Manage your management time

I’ll freely admit that one thing I completely underestimated was the amount of management time it would take to get the deal agreed and across the line.

You’ve got to conduct research into the company you’re acquiring; you have to complete due diligence – which means lawyers, accountants, and tax advisors; you have to negotiate with the seller, and then, once all that’s sorted, you can begin the real work of bringing the two companies together.

This work entails merging HR, finances, processes, offices, and many other unknown factors.

The process of acquiring a company is essentially another full-time job, and running a business is already several full-time jobs. It’s worth doing – but only if you have your eyes open about what it means and what it will take to do it.

Heather Baker is CEO of TopLine Comms and TopLine Film.