Review current 2020 M&A deal multiples, deal structure and other Q1 mergers & acquisitions trends and statistics from Calder Capital, LLC
While understandably it can be easy to turn negative during trying times like these, we wanted to make sure you were aware of some reasons to be optimistic regarding the business-for-sale market. Are Buyers Active? Yes! Buyers are very active and we expect to entertain near-record inquiries in the coming months. During the first half of March 2020, we had 649 buyers inquiring actively on current listings. Generally, disruptions of this scale end up producing a wave of new entrepreneurs that are interested in taking control of their destiny. How do we know this to be true? Record levels of buyers came out of the 2008-2010 Recession. Additionally, private equity and family office buyers have mandates to acquire companies. As proof that deals are getting done, our sister company, Small Business Deal Advisors, successfully sold two businesses in March 2020 including a restaurant. Has The Government Helped? Yes, the government has responded extremely fast relative to 2008-2010. The CARES Act does a couple of powerful things: Incredibly, Section 1112 mandates the SBA to pay the entirety of 6 months of interest, fees, and principal on all new 7a loans generated until September 27, 2020. We have never seen anything like this! It was […]
The purpose of this post is to try to understand what may unfold using historical examples and analysis. Knowing the challenges of the past should better allow us to foster the creativity necessary to overcome those challenges should they unfold again.