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Sell a Business Insights
Acquistition Offers Can Vary Widely
June 19, 2024 / in Business Valuation, Sell a Business / by Al Statz
Beauty is in the eye of the beholder; and when it comes to selling your business, value is in the eye of interested buyers. As sell-side M&A advisors, we determine and agree on a probable selling price range with our clients, but we generally don’t set an asking price or discuss our clients’ value expectations with potential acquirers. Lower-middle-market businesses rarely go to market with an asking price. Different buyers see different value in your business; …
Exit Strategies Group Advises Amick Brown in Strategic Sale
May 21, 2024 / in News, Sell a Business / by Mark Harter
Amick Brown LLC, a respected and long-established technology staffing and consulting firm in San Ramon, CA, was recently acquired by Zest LLC, an international technology staffing firm. Exit Strategies Group, Inc. advised the seller in the transaction. Terms of the transaction are confidential. Amick Brown was founded in San Ramon in 2010. The Company provides technology staffing and technology consulting services for government and private sector clients. Customers are located throughout the United States and …
Exit Strategies Group Advises Dynamic Solutions in Sale
May 15, 2024 / in Exit Planning, Sell a Business / by Al Statz
Exit Strategies Group has advised the owners of Dynamic Solutions, a California-based provider of industrial automation solutions, on their recent sale to Valin Corporation, a subsidiary of Graybar. Effective May 1, 2024, the acquisition significantly expands and adds technical capabilities to Valin’s automation and robotics group. Established in 1998, Dynamic Solutions specializes in precision motion control, machine vision, and collaborative robotics. Their team has over 120 years of combined experience in the industry. Dynamic Solutions …
It’s About Deal Structure in M&A
April 17, 2024 / in Exit Planning, Sell a Business / by Exit Strategies
Sometimes we work on the buy-side, helping strategic buyers and financial sponsors find and execute acquisitions. For one buy-side client, we approached a seller with what we thought was a fair offer, but the seller wanted more. We talked it over with our client and decided we could come close to the seller’s number, provided we got a specific deal structure. We arranged the deal with about 60 percent cash at close and 20 percent …
M&A Advisor Tip: Have the Discipline to Diversify
April 17, 2024 / in Business Strategy, Exit Planning, Sell a Business / by Exit Strategies
As a general rule, no single customer should account for more than 20-25% of your company’s revenue. While having major customers can be great for your bottom line, it represents substantial risk to you and the next owner. As you build your business, pay attention to what potential buyers will want. They’ll be looking for well-diversified customer base where the loss of one account won’t have a major impact on earnings. Do the hard work …
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 …