Why a Low Ball Offer Could Cost You More Than the Deal: Credibility, Reputation & Missed Opportunities

Why a Low Ball Offer Could Cost You More Than the Deal by Dr. Allen Nazeri Certified M&A Professional

In the world of mergers and acquisitions, particularly in healthcare, credibility is everything. As intermediaries, we speak with hundreds of buyers every year. We see who’s serious—and who’s not—usually by their very first move. And nothing screams “not serious” louder than a Low Ball Offer or worse, a no-money-down offer.

Let’s be clear: this isn’t about discouraging negotiation. It’s about recognizing that how you present yourself early on directly impacts whether you’re ever invited back to the table again.

What Is a Low Ball Offer and Why It Sends the Wrong Message

A Low Ball Offer is one that’s far below the fair market value of a business, typically without supporting rationale. It’s not uncommon for us to market a well-performing company, only to receive offers at 50% or less of asking price from buyers who haven’t even reviewed the CIM in detail.

When this happens, it tells the seller and the advisor one of a few things:

• The buyer hasn’t done their homework.

• They don’t understand the industry.

• They’re using a “spray and pray” tactic to see what sticks.

Unfortunately, what sticks is their name—in the wrong way.

The Risk of Getting Blacklisted for Making a Low Ball Offer

In any industry, reputation matters. But in healthcare M&A, where many deals are done quietly and through trusted networks, a buyer’s reputation is everything. When a buyer repeatedly makes Low Ball Offers or unrealistic terms (like no money down with 100% seller financing), intermediaries take note.

Here’s what happens behind the scenes:

• The intermediary flags the buyer internally.

• Their future inquiries are treated with skepticism—or ignored.

• They’re quietly removed from access to high-quality listings.

It’s not personal. It’s just business. Intermediaries want to protect their sellers, and no seller wants to engage with a buyer who doesn’t respect the value of their life’s work.

How to Make a Credible Offer Instead of a Low Ball Offer

If you're truly interested in acquiring a business, especially in a professional field like healthcare, there are ways to make your offer stand out without low-balling.

1. Educate Yourself Before You Offer

Understand the industry you’re entering. Dental, medical, hearing aid, behavioral health, and veterinary practices all have unique operating models, patient retention strategies, and valuation metrics. Know the typical EBITDA multiples and what drives value—such as recurring revenue, provider stability, and payer mix.

2. Base Offers on Real Financials

Use actual data from the CIM or financials to build your case. If you believe a business is overpriced, be prepared to back it up with data—not just your opinion.

3. Show Proof of Funds

Being “interested” isn’t enough. Buyers who submit offers without showing they have the capital or financing lined up rarely make it past the first round.

4. Be Transparent

Let the intermediary know if you're still raising funds or if your offer is contingent on something. We understand deals have moving parts. But hiding those parts is what creates mistrust.

5. Respect the Seller’s Legacy

Many sellers care deeply about what happens after they exit. They want their employees, patients, and customers to be well taken care of. A buyer who acknowledges this—by presenting a thoughtful post-close vision—is far more likely to win the deal, even at a slightly lower price than others.

Why a Seller Would Never Accept a Low Ball Offer with No Money Down

It’s one thing to make a Low Ball Offer. It’s another to ask the seller to finance your purchase through a seller note or by rolling equity—when you haven’t proven you’re worth betting on.

Let’s put this into perspective.

You’re asking a seller to:

• Accept less money than the business is worth.

• Take on the risk that you’ll pay them back.

• Hand over their team, customers, systems, and brand equity.

Why would anyone do that unless you’re bringing something else to the table—like experience, strategic resources, or a proven ability to grow the business?

If you don’t have these, your best move is to wait, learn the market, build your reputation, and come back when you’re truly ready.

The Bigger Picture: You’re Not Just Buying a Business—You’re Being Interviewed

Many buyers fail to realize that in every transaction, the seller is also choosing you. Just as much as you're performing due diligence on the company, they’re doing diligence on you.

They’re asking:

• Is this buyer financially capable of closing?

• Will they protect my staff and reputation?

• Do I trust them to carry on what I’ve built?

The moment a Low Ball Offer enters the conversation—especially if it’s poorly justified or paired with no money down—it often answers all of those questions with a resounding “no.”

Final Thoughts: Your First Impression Could Be Your Last

As someone who represents sellers across 52+ of healthcare sectors with over $750M in direct mandates, let me give you an advice,

You don’t have to offer full price.But you do need to offer full respect—for the numbers, the industry, and the seller’s legacy. A thoughtful offer, backed by real data, vision, and capability, will open more doors than a dozen Low Ball offers ever could. Buyers who take this approach aren’t just invited to the table—they often get a second helping of opportunity. And those who don’t? Well, they stop hearing about the opportunities and are often denied to take a deeper look at the mandates beyond the blind summary.

Dr. Allen Nazeri, aka "Dr. Allen," boasts over 30 years of global experience as a healthcare entrepreneur. He is the Managing Director at American Healthcare Capital and Managing Partner at PRIME exits. Dr. Allen provides strategic growth consulting to leadership teams of both privately held and publicly listed companies, ensuring their preparedness for successful exits.

He holds a Dental Degree from Creighton University and an MBA in M&A and Investment Banking from the University of Bedfordshire. He is a Certified M&A Professional (CM&AP) from Keenesaw State University. Dr. Allen is the author of the brand new book "Selling Your Healthcare Company at a Premium". Dr. Allen offers a free valuation to business owners ready for a partial or complete exit strategy. Dr. Allen collaborates with strategic buyers, private equity firms, and institutional investors, taking direct accountability for the annual successful sell-side representation of nearly $750M in enterprise value.

To have a confidential discussion about your company and receive a free valuation, please email Allen@ahcteam.com or Allen@ahcpexits.com or fill out the valuation form https://www.pexits.com/freecompanyvaluation

You can also now communicate with Dr. Allen's clone https://www.delphi.ai/drallen

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