As you likely know, working capital equals current assets minus current liabilities. Companies that have a high level of cash tied up in current assets (primarily cash, accounts receivable, and inventory) without similar levels of current liabilities are not as attractive as those who tightly manage their working capital. Buyers are often leery of businesses […]
I recently completed a valuation engagement for two shareholders of a California manufacturing company who were going through a buy-sell transaction. After the sale, the buying shareholder called to tell me how my valuation report gave him the confidence he needed to complete the purchase, take on debt, and revamp the company’s business plan. Besides […]
In building a successful company, owners usually invest in hiring and developing managers and key contributors that become vital to the company’s effective operations. These people are considered “key employees”. When the time comes for the owner to exit his or her business, these key employees are usually valuable “assets” in the eyes of potential […]
EBITDA may seem to be the holy grail of business assessment in the M&A world. Almost every potential buyer starts by asking what is the selling company’s EBITDA; and almost every seller wants to know at what multiple of EBITDA his or her business will sell for. From an accounting standpoint, EBITDA is a simple […]
Normally we blog about M&A or Business Valuation issues, but this week I want to address email effectiveness, a subject important to all business people considering the tsunami of email messages most of us receive each day (an estimated 121). I recently read an article from the Harvard Business Review that succinctly focused on important do’s […]
Sacramento, California – Exit Strategies is pleased to announce the acquisition of microwave electronics manufacturer Aldetec, Inc. by U.S. Technologies, a portfolio company of Cornerstone Capital Holdings. Sold To: Aldetec, Inc. designs and manufactures integrated microwave assemblies and RF amplifiers for the commercial, military and space flight industry sectors. US Technologies (UST), of Fair Lawn, […]
Pepperdine University, of Malibu, California, in conjunction with the International Business Brokers Association and M&A Source, publishes a quarterly Market Pulse Survey of business brokers that provides useful information concerning the market for Main Street ($0-$2M sales price) and lower middle market ($2-$50M sales price) businesses. Highlights from their most recent report for Q1 2016, include: […]
When developing an exit strategy for your company, we will consider whether Private Equity Groups (PEG’s) would want to acquire it as either a new platform company or as an add-on (also “bolt-on”) to one of their existing portfolio companies. Most small companies are too small or don’t have strong enough management teams to be attractive platform opportunities, however many are strong add-on candidates. According […]
When selling a C-Corporation, most sellers will want to sell stock while most buyers will want to buy the assets. Selling the stock minimizes the built-in gains (BIG) for sellers that carries a hefty double taxation first at the corporate level and second individually. Buyers wish to buy assets for a number of reasons including […]
Business valuations (a.k.a. appraisals) come in many shapes and sizes depending on who has done the work and the process they have followed. Here’s a brief checklist of what to look for in an appraiser’s engagement letter and CV prior to hiring him or her: 1. Is the appraiser competent to perform your business valuation? Verify that […]
Exit Strategies Group, Inc. is a leading provider of business sales and acquisitions, business valuations, and exit planning services for family owned and closely-held companies since 2002.
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