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Exit Strategies Group Advises Leap Solutions Group on their Sale to George Petersen Insurance Agency
March 26, 2024 / in News, Sell a Business / by Roy Martinez
Exit Strategies Group, Inc., a California based mergers and acquisitions (M&A) brokerage and business valuation firm, recently advised the owners of Leap Solutions Group, Inc. of Santa Rosa on the sale of their business to George Petersen Insurance Agency. Leap Solutions Group is a business management consulting firm specializing in organizational development, human resources, executive search, and recruitment. Scott Ormerod, Leap Solutions co-owner, said, “Roy Martinez of Exit Strategies was our guide through this process, …
Is a Quality of Earnings (QoE) Analysis the Same as an Audit?
March 17, 2024 / in Acquire a Business, Exit Planning, Sell a Business / by Al Statz
Not exactly. A Quality of Earnings (commonly called a “QoE”) analysis used in mergers and acquisitions due diligence and a financial Audit serve distinct purposes. Here’s how they differ in terms of purpose, scope of work, timing and reporting: Purpose: QoE: The primary purpose of a QoE analysis is to assess the sustainability and reliability of a company’s earnings and cash flows. It aims to identify potential risks and irregularities in a company’s earnings that …
What’s behind the door for M&A in 2024?
March 14, 2024 / in Exit Planning, Sell a Business / by Exit Strategies
We’re coming off a recalibration year for M&A. While 2021 and 2022 saw record activity, the first half of 2023 was marked by significant declines. Inflation, interest rates, increased capital costs, and geopolitical uncertainty all made buyers wary, and the global market held back on deal making. Now we’re anticipating an uptick in 2024. This resurgence will be fueled by the continued presence of cash in the marketplace, corporate growth demands, and Baby Boomer …
What is an equity rollover when selling your business?
February 21, 2024 / in Exit Planning, Sell a Business / by Exit Strategies
In M&A, an equity rollover, or recapitalization (recap), occurs when a business owner sells their company but chooses to reinvest, or “roll over,” a portion of their proceeds into the newly acquired business. An equity rollover allows a shareholder to maintain an interest in the business and benefit from future growth and value creation. How an Equity Rollover Works When a business owner is selling, a potential buyer may propose a deal structure that includes …
M&A Glossary: Quality of Earnings (QofE) Report
February 21, 2024 / in Acquire a Business, Exit Planning, Sell a Business / by Exit Strategies
A Quality of Earnings (a.k.a. “QoE” and”QofE”) report is prepared by a CPA firm to provide a detailed analysis of a target company’s revenue, expenses, working capital, EBITDA adjustments, etc. While not an Audit, a QoE provides buyers with important assurances on cash flows and risk. When buyers do this work internally its often just called “financial due diligence”, and when they outsource it, it’s called Quality of Earnings. See this post comparing a QoE …
Time to Close
February 21, 2024 / in Exit Planning, Sell a Business / by Exit Strategies
Median time to close remains somewhat consistent year-over-year, with businesses generally selling within one year of a listing engagement. Main Street deals typically close faster due to reduced due diligence demands. Follow these links for more information on Exit Planning Benefits, common Exit Options, and the Exit Planning Process. About the Market Pulse Survey — Each quarter, the M&A Source and IBBA, in partnership with Pepperdine University’s Private Capital Markets Project, survey North American lower middle market …
Why Some Testing, Inspection and Certification Companies Sell for More than Others.
February 5, 2024 / in Exit Planning, Sell a Business / by Adam Wiskind
Testing, Inspection, Certification (TIC) companies play a crucial role in various industries, from agriculture to manufacturing to construction, by providing services that verify adherence to standards, regulations, and specifications. TIC services are typically nondiscretionary, regulation driven, recession resistant, and predictable, which makes businesses in this sector a priority investment opportunity for private capital and strategic investors. However, owners of TIC companies that are preparing to sell should know that in the eyes of an investor, …
Exiting Without a Plan
February 2, 2024 / in Exit Planning, Sell a Business / by Exit Strategies
Even though retirement is far and away the biggest reason that business owners sell, many owners are doing little to no exit planning before going to market. The above chart shows that the smaller the business, the less likely owners are to plan. Of those owners who did plan, most started less than a year before putting their business on the market. Follow these links for more information on Exit Planning Benefits, common Exit Options, and …
Seller Sentiment Declined in 2023
January 17, 2024 / in Acquire a Business, Exit Planning, Sell a Business / by Exit Strategies
A seller’s market is when sellers feel they have an advantage or it’s a good time to sell, for instance when demand exceeds supply and there are more interested, active buyers than there are quality deals on the market. In a seller’s market, buyers compete in order to win deals. This typically translates to increased values and more favorable deal terms for the seller. The results of the latest Market Pulse Survey (Q3 2023) show …
Expect M&A to Recover in 2024
December 19, 2023 / in Exit Planning, Sell a Business / by Al Statz
Global M&A deal value nearly reached a 10-year low in Q3 2023 (Q2 2020 excepted). Deal count and total deal values both declined, as shown in this graph produced by Pitchbook. And these declines were evident across almost all most industry sectors and among all types of acquirers and sellers. However, several factors are pointing to a recovery in M&A activity in 2024. The global total of $1.4 trillion in unspent PE dry powder is …