Companies looking to make acquisitions are referred to as ‘trade buyers’. They could be a competitive business from the same industry, or looking to move into the industry or geographical territory. When properly funded, trade buyers can often move quickly and, because they already know the sector, will often rely on their own intuition and due diligence. It is important, however
to recognise they may be competitive so the release of information must be managed carefully
A trade buyer with a specific interest in either acquiring your business in full or part to gain market presence quickly or to take out a competitor. There may be an opportunity via a
partial sale and create a strategic partnership leveraging their financial resources and infrastructure as a longer term exit plan. If you have the interest and energy to remain in the
business for 3, 5 or more years, this could prove a highly profitable move.
Private Equity (PE) firms, funded mostly by high net worth individuals and pension funds may see you business as a ‘bolt-on’ to an existing business where they have already invested or as an initial step into and business sector know as a ‘platform deal’. Deals with PE can be complex but they are well funded, in many cases they can deliver a short term exit to a retiring business owner, or ongoing financial and management support to a growing business.