M&A in a Volatile Economy | Russia, Recession, & Economics

Economic headwinds ahead. Steven Chiavarone, CFO and economist with Federated Hermes, recently presented at the State of M&A conference held in Wisconsin. He shared a range of insights and economic predictors he expects to affect the business community and mergers and acquisitions in the years ahead. These were: Geopolitical Conflict and Supply Chain Disruptions A […]

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What Creates a Strong M&A Market for Sellers?

A strong M&A market for sellers typically arises from a confluence of factors. High demand from a large pool of buyers, coupled with abundant capital available for investment, creates a competitive bidding environment that drives up valuations. Favorable lending conditions, characterized by low interest rates and accessible financing, further empower buyers and support robust deal […]

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What Do Rate Hike Cycles Mean for Business Sellers?

Economist Steven Chiavarone presented at CIA partner’s annual State of M&A conference in February. As he pointed out, there have been 11 rate hike cycles since 1970 of three hikes or more. Of those, nine were followed by a recession. (The other two were followed by a stock market crash and the Mexican peso crisis.) […]

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Why Do You Need an M&A Attorney to Avoid Sale Delays?

We had a signed letter of intent in April and were set to close the transaction in June – until the seller’s lawyer got in the way. What should have taken 60 days ballooned into a full six months. Luckily, it still closed. In this particular transaction, the client insisted on working with his real […]

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How Stay Bonuses Add Value for Business Sale

Confidentiality is important in a sale. But what do you do when critical employees must be informed? We recommend stay bonuses. A stay bonus provides an incentive for key employees to cooperate and assist with a sale. Stay bonuses typically range from 20% to 100% or more of an employee’s salary. It’s common to allocate […]

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The Benefits of Planning Your Business Exit & Sale Early On

Over my career, I have witnessed business owners who spent more time planning for their children’s wedding, their 50th wedding anniversary, or even their fantasy football draft, than they put into planning for the sale of their business. Most Business Owners Don’t Plan Ahead According to the quarterly Market Pulse Report, we know that when […]

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How Biden’s Tax Plan Drove Business Owners to M&A Market

During his campaign, President Biden proposed tax changes that could have a significant impact on business owners. Any business owner contemplating an exit in the next few years should consider how potential tax changes could reduce their net proceeds from a sale. If Biden’s tax plans come to fruition, the capital gains tax rate could […]

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5 Common Deal Killers to Avoid When Selling Your Business

Some of most common M&A deal killers we see are time delays, inexperienced advisors, surprises in due diligence, unassignable contracts, and fear of the unknown. Cue up the scary Halloween music. When selling your business, you can expect to hit a few snags before the deal is complete. But proper planning can help you avoid […]

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Do Business Buyers Need to Finance in Lower Middle Market?

In the lower middle market, most sellers still find they must finance a portion of the sale of their business. Expect to provide anywhere from 5% to 15% seller financing. This helps close a funding gap and demonstrates that you believe in the business as a going operation. Sellers who are confident in the buyer’s […]

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DIY Selling Your Business Yourself Can Cost You 30%

It’s estimated that in the lower middle market, only 20% to 30% of companies that want to sell will successfully transition to new owners. The primary reason this percentage is so low is that business owners often try to handle a sale themselves or use an advisor with limited experience and buyer reach. For most […]

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