Sellers generally desire all-cash transactions; however, partial seller financing is often necessary in middle market company transactions. Furthermore, sellers who demand all-cash deals typically receive a lower purchase price than they would have if the deal were structured differently. Although buyers may be able to pay...
Mergers may seem like a step forward. But like any deal, mergers come with a degree of risk. The odds are good that you’ve heard of the massive merger between the German auto manufacturer Daimler and the American car company, Chrysler. In this deal, we...
Two businesses could report the same numeric value for earnings but that doesn’t always tell the whole story. As it turns out, there is far more to earnings than may initially meet the eye. While two businesses might have a similar sale price, that certainly...
Acquihire is the process of acquiring a company for its talent rather than for its products, services, or earnings stream. Another way of thinking of an acquihire is that it is basically purchasing a team of smart people (often engineers) who have worked together successfully,...
There are a many types of ownership transitions in privately owned businesses, ranging from gradually giving more control to family members to selling the business to outside parties. In every type of ownership transition the participants can learn a great deal from the failures of...
Too many acquisitions fail to produce the value that’s expected. In a recent survey by the M&A Leadership Council, 52% of respondents said their acquisitions failed to meet their revenue goals and 39% said they failed to achieve their cost-saving objectives. The top three obstacles...
Many successful companies plan to buy other businesses to accelerate their growth and execute on their strategy. But finding the right acquisition target and closing a transaction takes time, money, and specialized skills. These truths are amplified in the fast-changing technology world, where there are...
In my previous blog I shared five questions that almost every buyer asks about a business that they are considering buying. Here are five questions that buyers should ask, but often don’t. When did the owner decide to sell the business? Business buyers always want to know...
The average business buyer goes into the process with a list of questions to ask the seller. So if you plan to sell your business someday, here are five questions that almost every buyer is going to ask you. In my next blog I will write...
10. Economizing on due diligence Many buyers fail to dig into due diligence, which is the time to really learn about what you are about to acquire and whether or not it fits your company and your strategy. It’s time consuming and can be expensive, but...