Acquiring another business can be one of the most powerful ways to accelerate growth. It can open new markets, bring in specialist talent, expand product lines and create efficiencies that would take years to build organically. Yet while acquisitions offer opportunity, they also carry significant risk. Overpaying, inheriting hidden liabilities or underestimating integration challenges can quickly turn a promising deal into a costly distraction.
For business owners and management teams considering an acquisition in 2026, transaction services play a critical role in protecting value at every stage. From early risk assessment through to post-deal integration, the right support can provide clarity, strengthen negotiating positions and ensure that what looks good on paper translates into long-term success in practice.
Why acquisitions go wrong without proper diligence
Many deals are driven by strategic ambition. A target may look attractive because of strong headline profits, a loyal customer base or perceived market share. However, the reality beneath the surface is not always so straightforward. Financial information may be inconsistent, earnings may rely on one-off contracts, or working capital requirements may be far higher than expected.
Without detailed financial due diligence, buyers risk basing their decisions on incomplete or overly optimistic information. Even experienced management teams can underestimate the complexity of another company’s finances, tax position or contractual obligations. What appears to be a profitable business can quickly reveal cash flow issues, historic tax exposures or underfunded pension liabilities once examined more closely.
Transaction services help bridge this gap. By analysing financial performance, normalising earnings and identifying potential risks, advisers provide a clearer picture of the business being acquired. This insight is essential not only for deciding whether to proceed, but also for structuring the deal and negotiating the right price.
Understanding true financial performance
A central part of any acquisition is understanding the target’s true financial performance. Reported profits may include non-recurring income, changes in accounting policy or costs that will not continue post-acquisition. Equally, some expenses may be understated or omitted entirely.
Transaction services teams focus on quality of earnings, adjusting reported figures to reflect sustainable, underlying performance. They examine revenue streams, margins, cost structures and working capital trends to determine whether profits are repeatable and cash generative. This process helps buyers avoid overpaying based on inflated or unsustainable results.
Working capital analysis is particularly important. Many acquisitions are structured with a “normalised” working capital target, and failing to understand the business’s true requirements can lead to unexpected cash injections after completion. A thorough review ensures that buyers enter the transaction with realistic expectations and appropriate safeguards.
Identifying tax and structural risks
Tax considerations are often overlooked in the early stages of an acquisition, yet they can have a significant impact on value. Historic tax exposures, incorrect VAT treatment or poorly structured group arrangements can create liabilities that pass to the buyer.
Specialist tax due diligence helps identify these issues early, allowing them to be addressed through price adjustments, indemnities or restructuring. It also ensures the acquisition itself is structured efficiently from a tax perspective, whether through a share purchase, asset purchase or group reorganisation.
Engaging with advisers familiar with UK tax frameworks and requirements from bodies such as HM Revenue & Customs helps ensure compliance and minimise unexpected liabilities. Early planning can also identify opportunities for reliefs or efficiencies that improve overall deal economics.
Strengthening your negotiating position
One of the often-overlooked benefits of transaction services is the leverage it provides in negotiations. When buyers have a detailed understanding of a target’s financial position and risks, they are better equipped to structure deals that protect their interests.
For example, if due diligence reveals customer concentration risk or reliance on a key supplier, this may lead to earn-out structures or deferred consideration. If working capital requirements are higher than expected, this can inform adjustments to the purchase price or completion accounts mechanism.
Rather than relying solely on headline valuation multiples, buyers can negotiate based on detailed evidence. This not only protects against overpayment but also helps build a more balanced agreement that reflects the true risk profile of the business.
Planning for integration from day one
A successful acquisition does not end at completion. Integration is where value is either realised or lost. Systems must be aligned, teams integrated and processes streamlined. Cultural differences, technology mismatches or unclear reporting lines can quickly erode the anticipated benefits of a deal.
Transaction services can support integration planning even before the transaction completes. By identifying operational differences, key personnel dependencies and financial reporting gaps, advisers help buyers prepare for the transition. Early planning ensures that management teams understand what needs to change, what should be preserved and how to maintain business continuity during the process.
Financial reporting is often a key focus. Aligning accounting policies, consolidating systems and establishing clear reporting structures allows the combined business to track performance effectively from day one. This is particularly important where external funding or investor reporting is involved.
Protecting long-term value
An acquisition is a significant investment of time, capital and management attention. Protecting that investment requires more than a cursory review of accounts or a high-level valuation. It requires a structured approach that examines financial performance, tax exposure, operational risk and integration readiness.
Transaction services provide this structure. They help buyers move beyond surface-level assessments and make decisions based on detailed, reliable information. This reduces the likelihood of unpleasant surprises and increases the chances that the acquisition will deliver its intended strategic and financial benefits.
In a competitive market, where attractive targets may attract multiple bidders, moving quickly is often important. However, speed should not come at the expense of diligence. Engaging transaction specialists early allows buyers to act decisively while still maintaining rigorous analysis and risk management.
Making your next acquisition a success
If you are considering acquiring another business in the coming year, the earlier you involve transaction services support, the better positioned you will be. From initial assessment through to post-deal integration, experienced advisers can help you understand the true value of a target, structure the deal effectively and plan for a smooth transition.
Acquisitions can transform businesses, but only when approached with clarity and preparation. Transaction services provide the insight and protection needed to ensure your investment delivers the returns you expect.
If you are thinking of buying another business, now is the time to start the conversation.
Speak to a transaction services specialist who can guide you through the process, identify risks early and help you move forward with confidence. With the right support in place, your next acquisition can become a powerful driver of growth rather than a source of unexpected challenges.