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Acquire a Business Insights
M&A Advisor Tip: SBA debt relief incentivizes buyers
June 2, 2020 / in Acquire a Business, News, Sell a Business / by Exit Strategies
SBA debt relief is is a big incentive for buyers to move ahead with small business acquisitions right now. The SBA will pay six months of principal, interest, and any associated fees that borrowers owe for all current … as well as new 7(a), 504, and microloans disbursed prior to September 27, 2020. As an added incentive, SBA lenders have the authority to defer loan payments for six months. That means some buyers could acquire …
Market Pulse Survey: Deal Cancellations due to COVID-19
May 18, 2020 / in Acquire a Business, News, Sell a Business / by Exit Strategies
M&A advisors saw many of their business sale/acquisition deals delayed, put on hold or cancelled in March 2020 as a result of the COVID-19 Pandemic. Who was cancelling these deals? The following chart shows the results of this survey question from the latest Market Pulse Survey. Presented by IBBA, M&A Source & in partnership with Pepperdine University “Deal activity is always expected to constrict during times of uncertainty. Both sellers and buyers are being conservative …
Valuing a Business in Bankruptcy
April 8, 2020 / in Acquire a Business, Business Valuation, Sell a Business / by Exit Strategies
According to data collected by the U.S. Bankruptcy Courts, business bankruptcies declined from 60,750 (or 4% of total filings) in 2009, just after the 2008 financial meltdown to approximately 22,750 in 2019 (or approximately 3%).[1] With overwhelming challenges ahead as a result of the Coronavirus Pandemic, the question is not if these filings will go up over the next 12 months but by how much. Before I dig into valuing a business in bankruptcy, let’s …
The Value of a Sell-Side M&A Advisor to Buyers
April 2, 2020 / in Acquire a Business / by Al Statz
Strategic and financial buyers often tell me how they appreciate the value that experienced, ethical and professional sell-side M&A advisors (a.k.a. business intermediaries, investment bankers, or business brokers) bring to a deal; even when that advisor represents the seller! As a buyer, you can expect a sell-side M&A advisor to help by compiling, analyzing and serving up relevant business information, by bringing transparency to the process, by facilitating the process, by introducing funding sources and …
‘No Shop’ Protects Buyer Investment in M&A
January 17, 2020 / in Acquire a Business, Sell a Business / by Exit Strategies
A no shop provision is an important part of M&A transactions. Also known as an exclusivity clause, a no shop clause prohibits the seller from sharing information or negotiating with other would-be buyers for a specified time frame. Prior to this, the seller is negotiating with several buyers. The goal is to entertain multiple offers and figure out which buyer will ultimately provide the best deal for the seller. Once the seller has identified their …
Nine Warning Signs Your Buyer Can’t Close the Deal
December 4, 2019 / in Acquire a Business, Sell a Business / by Exit Strategies
The proof is in the pudding. It ain’t over ’til it’s over. Don’t count your chickens before they’ve hatched. Pick your cliché. Just because someone makes an offer to buy your business doesn’t mean they will close the deal. As a seller, you need to look at more than dollar signs on a purchase offer. Make sure your advisors are researching and asking questions to figure out which buyers are for real, and which ones …
M&A Advisor Tip: What Buy-and-Build Means for You
December 4, 2019 / in Acquire a Business, Business Strategy / by Exit Strategies
Private equity firms have increased their use of buy-and-build investment strategies. A buy-and-build strategy involves bolting together several smaller companies into a larger business enterprise that will likely sell at a higher multiple. See our post on the size effect. This trend is affecting many industries, from healthcare clinics to niche business service companies. The uptick in buy-and-build acquisitions could mean more buyers and more competition for your business than you expect. Contact Al Statz …
Exit Strategies Advises on Management Buyout of Carpenter Crane Hoist
January 10, 2019 / in Acquire a Business, News / by Al Statz
MARE ISLAND, California – Exit Strategies is pleased to have recently served as financial acquisition advisor in management’s carve-out of the Carpenter Crane Hoist division from The Carpenter Group (TCG). The buy-out (MBO) was led by executives Dane Oliver and Ben Jones with the support of an equity partner. The acquisition marks the beginning of an exciting era for Carpenter Crane Hoist (CCH) as management implements plans to expand offerings and operations to address the needs …
Recent Changes to the SBA 7(a) Loan Program for Business Acquisition Financing
May 23, 2018 / in Acquire a Business / by Louis Cionci
SBA 7(a) loans are a popular type of financing for small business acquisitions. These loans go up to $5,000,000 and can be used to buy a business, real estate or equipment. Several changes to the SBA 7(a) program became effective in 2018 that are worth noting. Some of those changes include: Lower down payment. Required down payment has been reduced from 25% of the purchase price to 10% of the project cost (project cost = …
Current Market Multiples for Main Street Business Sales
December 6, 2017 / in Acquire a Business, News, Sell a Business / by Louis Cionci
Each quarter, The International Business Brokers Association (IBBA) and M&A Source together with Pepperdine Private Capital Markets Project and the Graziadio School of Business and Management at Pepperdine University publish a quarterly national survey of business brokers and M&A advisors called the Market Pulse Survey. Price multiples and other key metrics in the Main Street Market section of the Q3 2017 survey are presented below. Main Street businesses are defined as those with enterprise values …
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