December 1, 2024
One of the recent deals we closed was a service company that had been in business for 20+ years. The owner started the business in his mid-30s and grew it to the point where he only came in 1 or 2 days a week, as he had key leaders in place. Unfortunately, his wife had a health scare, and he was ready to do something else with his time, which led him down the path of selling his company. During the interview process, we competed against 4 other firms, most of which were local; however, he preferred our deadline-driven approach along with our detailed process and was ready to move forward. After the deal closed, we referred our client to a financial advisor who is now working to bring them on as clients.
When we speak with owners about selling their business, some think their industry or geographic location wouldn’t generate good interest. However, this all comes down to marketing and getting it in front of the most viable buyers. After preparing all the materials and sending them out confidentially to strategic and financial buyers, we obtained 6 bids for their business. From that pool of buyers, we set up management meetings with the 3 best – meaning they had the money, strategic focus, and a high likelihood of closing the deal without causing unnecessary delays.
We were able to secure 2 Letters of Intent from A+ buyers as a result of our meetings. Every owner has different aspects that are important to them in a deal, and for our client, it came down to which one was offering the best value. They ended up going under exclusivity with a $900 million strategic buyer who saw our client as solving a geographic need, thereby optimizing expansion.
One phrase you’ll often hear us repeat is that “time kills deals.” The longer the process drags on, the greater the odds of a renegotiation in the buyer’s favor and the fewer the odds of the deal closing. During due diligence, we encountered a challenge with our client having difficulty providing financial information. However, the buyer, recognizing our client as a must-have, was understanding and didn’t push too hard for updated numbers. Our team remained proactive, staying on top of this crucial issue. Despite some softening in financial performance, the buyer continued to move forward with the deal, and we were able to close in a timely manner. From start to finish, this transaction took 7 months, and our client can now move on to his family’s next chapter.
So far this year, we have closed 21 deals and are up 20% compared to the same time last year. 2025 is shaping up to be the “perfect storm” for deal-making, with robust demand for businesses looking to strengthen market positions and private equity funds sitting on record levels of undeployed capital. It’s never too early to begin planning for the potential sale of a business. Once we learn enough about a business, we’re able to offer a free value assessment and discuss timing.