Leading Software-as-a-Service (SaaS) dance studio customer management and payment processing technology platform.
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Leading Craft Brewery and Distillery Located in Moab, Utah
Salt Lake City, Utah, (January 8, 2020) – The Forbes M+A Group, a leading transaction advisory firm, served as exclusive advisor to Moab Brewery, the city of Moabs’ only on its to Montage Partners, a private equity group out of Scottsdale, Arizona.
In 3Q19, overall Middle Market M&A activity increased, but total deal value declined.
3Q19 Middle Market M&A multiples remained elevated in the U.S. at 7.4x EV/EBITDA, as low borrowing costs allowed for larger deals to be completed. Read more
When one sells their house, the best deal is usually the highest price. When one decides to sell their business, there may be other factors to consider. Many buyers are similar to the buyers described below, serious and qualified; and most sales of businesses are win-win transactions. However, there are a few exceptions, and sellers should consider them carefully, balancing their prerequisites to the goals of the buyer.
Selling to a Competitor
Many company owners think this is the best way to go. They read about the mega-mergers such as Bank of America and Merrill Lynch, or the deals such as LVMH and Tiffany & Co., and GE and Danahrer. Consolidation may play a major role in large public companies; this is not the case in middle market companies.
Many owners of middle market firms look at these mega-deals and think it might work for them. However, upon further consideration, they realize that by disclosing a lot of confidential information to a competitor, their business could suffer irreparable damage if the deal would fall apart – and many do.
Selling to a Strategic Acquirer
This may bring the highest price, but there are several reasons why this may not be in the company’s best interest. Many owners have worked with key employees for years and would not like to see them replaced. The strategic owner might not only replace members of management but might also move the company to another part of the country.
Selling to a Financial Buyer
This buyer may not be willing to pay the seller’s price and is usually buying a company with intentions of selling it at a profit in three to five years. This leaves the company and its employees in limbo waiting for a new owner to take over.
The employees may decide to buy the company (ESOP). However, this usually means a long-term payout for the owner. An individual buyer may come along such as a Warren Buffett, but what are the chances? A key member or members of management might decide to purchase the company, but generally they won’t pay the price. If a sale is not consummated, the key management member(s) will most likely leave. In addition, there are motivated individuals who are backed by investors or large amounts of capital who could be a potential buyer.
There Is No Magic Answer – Selling a company comes with no guarantees. When Badger Meter Company, a public company headquartered in Milwaukee, acquired Data Industrial Corporation based in Mattapoisett, Massachusetts, this appeared to be a marriage made in heaven. Their respective product lines fit like a glove, their corporate cultures seemed compatible, and sales expansion by cross-selling was evident.
This strategic acquisition would have been fine except for one change. The parent company moved Data Industrial’s operation to Kansas, and every employee’s job was terminated. However, one should not construe that all acquisitions by strategic or competitive acquirers end up in a similar fate. Furthermore, for price considerations, the seller can draft restrictions in the Purchase & Sale agreement to prevent the transfer of the business, at least for a specified time period.
Certainly, selling to the particular type buyer doesn’t guarantee all of the seller’s concerns, but knowing the interests of some of the various buyer types can help ensure that the goals of both buyer and seller are met. Sellers should determine their goals prior to attempting to sell their business. A consultation with a investment bank is a good start to this process.
Mr. Morgan Brings a Strong Range of Merger & Acquisition and Capital Markets Execution Experience to the Company’s Expanding Senior Team, and Growing Presence in the Utah Market
Mr. Quisenberry Will Bring Decades of Experience as an Entrepreneur, Trusted Advisor, and Dealmaker
Colorado Advisory Firm Selected as Industry Leader in Elevated Performance and Service for 2020
The Forbes M+A Group took a trip out to Bandimere Speedway in Morrison, Colorado for an afternoon of adrenaline spikes and team bonding.
Leading funeral service provider
Greenwood Village, Colorado (September 9, 2019) – The Forbes M+A Group (Forbes M+A), a leading transaction advisory firm, served as exclusive advisor to Ponderosa Valley Funeral Services (Ponderosa Valley), a premier Colorado-based provider of traditional and memorial funeral services in the Rocky Mountain Region.
In 2Q 2019, overall middle market M&A activity continued at a slower clip compared to 2018’s record breaking pace.
Despite slightly depressed deal volume, Middle Market M&A multiples remained elevated in North America at 7.6x EV/EBITDA, as low costs allowed for larger deals to be completed.