Advice for Entrepreneurs, Business Valuation, Mergers and Acquisitions, Distressed M&A, Buying a Business
Changing gears in the acquisition engine
How has the M&A market shifted?
The COVID-19 health crisis and ensuing economic disruption has impacted virtually every aspect of society. While, in the midst of this uncertainty, it may be challenging to think long-term, we are seeing some companies start to plan for acquisitions in the coming months. These companies are well-capitalized, and have a long-term view and commitment to success in their industries.
As we talk with these companies about their strategies, there are a few areas we’re focusing on:
- Shifting gears from (a) competing for targets to (b) crafting solutions for business owners;
- Managing conversations with prospective sellers in a disciplined way, and thoughtfully working through the key phases of an acquisition;
- Lining up financing early; and
- Approaching potential sellers as business partners, with an open conversation about how you see the potential of working together.
The deals done coming out of 2008/2009 were some of the best performing acquisitions in the past 20 years. While there are areas we encourage our clients to be cautious about in this market, we also believe that deals done in the coming year will be some of the best of their careers. 2020 will present opportunities to the well-prepared acquirer that will not be seen again. We’re encouraging clients to come up with a “wish list” of companies in their industry that would make the most sense to acquire and to start those conversations in the coming months.
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Alan Fullerton is a partner with Mirus Capital Advisors. He works with owners of middle market businesses and can be reached at fullerton@merger.com.
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