Deals took longer to close across all sectors per the 2015 4th quarter Market Pulse Survey. Closing times saw jumps of up to nearly four months.
Typically, the larger the deal, the longer it takes to close. But the lower middle market has a large number of active buyers, and one way buyers win deals is by showing that they can close in a quicker timeframe.
As more buyers come to the table, we are able to run a more efficient process.
Median Time to Close Significantly Higher in 2015
Many sellers believe that once they receive a signed LOI their business is ‘sold.’ But quite a bit of legal and due diligence work still needs to be done. It’s important for sellers to understand this is a process and the sooner they become prepared, the better the results. Additionally, many buyers are requesting that the sellers consult with the new buyer for up to a year after closing.
Additional Key Findings:
The top two industries for business sold in the $2 million or less range were restaurants and business services.
‘Retirement’ continues to dominate sellers’ motivations for selling their businesses.
Contact Diana L. Miles of Bridge Mergers and Acquisitions to learn more about your industry’s M&A activity by emailing Miles@BridgeMergers.com or calling 704.488.4292.