Recently Merrill Corporation released their “America’s Deal Drivers for 2019” report in conjunction with Mergermarket. These two leading M&A organizations have once again provided not only an overview of 2018 activity, but a sensible roadmap for the remainder of 2019.
Based on their analysis of Mergermarket data:
“M&A deal value climbed higher in North America last year, as acquirers took advantage of strong balance sheets and ample access to financing to get deals done. Total M&A value in the region reached US$1.61trillion, representing a 13.5% increase.”
And so far in 2019, the pace of deal making in North America has picked up:
“There have been 504 deals valued at US$257.5 billion so far in 2019, up 15.4% from US$223.2 billion announced in the same period last year, according to Mergermarket data.”
These numbers are truly remarkable when you consider how strong 2018 finished. Normally a new year begins with a brief lull in deal making, as investment banks try to replenish their depleted inventory and acquirers digest the prior year’s acquisitions.
But, as we have seen before, 2019 is starting off much stronger than anyone predicted. In fact, Bloomberg News recently released this data:
“Globally deal makers made a comeback in January, logging $275 billion of mergers and acquisitions to mark the best start to a year in almost two decades. The surge was led by North American deals, with $187 billion of transactions announced during the month — up 40 percent from 2018 — according to data compiled by Bloomberg.
“M&A came back even though the markets felt choppy, and that shows how confident CEOs are,” said Susie Scher, co-head of the global financing group at Goldman Sachs Group Inc.”
Even though the economy continues to chug along nicely, and more importantly CEOs are positive about the future of their companies, there are some concerns highlighted by Merrill:
“Economic conditions in North America appear rosy on the surface, with unemployment and interest rates low and the economy growing at a steady pace. However, 54% of respondents in the Americas singled out the US-China trade war and tariffs as the business risk most likely to climb farther up due diligence checklists this year.
"But ultimately, market participants see upside even despite some concerns. For instance, 47% of our poll respondents said valuations have become more sensible over the last several months — providing much-needed relief to M&A buyers amid a period of frothy prices. With plenty of investment dollars waiting to be put to work, any slowing in activity may actually push some acquirers to redouble their efforts to source deals.”
This last point is vital: If you are the owner of a privately-held business today, you can expect to start receiving even more phone calls from potential buyers than ever before! This can be good or bad depending on the experience you have negotiating and closing the sale of your business.
If you are like most business owners, you will sell one company over your entire career. The professional buyers you want to deal with (because they’ll pay top dollar) have a distinct advantage because they close several deals every year.
How can you take advantage of the current seller’s market and receive maximum value for your company?
By hiring an M&A advisory firm with proven experience and track record of success. Although there are several good investment banks/M&A advisors in North America, none can compare with the success that Generational Equity has experienced over the last past decade plus.
Here are just a few of our honors:
How have we been so successful and achieved these wonderful accolades from our peers? Two reasons:
Both go hand-in-hand. What we do best is to evaluate and sell privately-held companies. And, we do this so well because of the significant experience of our team.
The first step in our process is having business owners and their partners/spouses attend a complimentary Generational exit planning conference. While there you will have the opportunity to meet with a couple of our exit planning team members who will be able to confidentially determine if your business is a good fit for our services.
If you are interested in learning more about our conferences and our services, please follow these links:
By Carl Doerksen, Director of Corporate Development at Generational Equity.
© 2019 Generational Equity, LLC. All Rights Reserved.
I am pleased that I was able to work with Andrew Byrd throughout this experience. From the first meeting we had in Minneapolis I felt that I was in good hands. His knowledge and expertise is second to none. He guided the process consistently throughout. I feel lucky that I was pared with Andrew and could not be happier that I chose Generational Equity to handle this major life event. Thank you Andrew and GenEq for everything!Eric Erlandson, Owner, Action Fastenings, Inc.
We were happy to see the interest in our company and what we cherished has not just a valuable company but an important company to the communities we served in.Larry Moore, Owner, A Company Portable Restrooms
The process was much more involved than I expected and your help, experience and advice was a big factor in making the negotiations go as smoothly as possible.Terry D. Wickman, President, Keytroller
Your wisdom and experience were invaluable to me during this once-in-a-lifetime transaction.Ralph Noblin, President of Noblin & Associates
Thank you again for all your guidance and support. Any company will achieve what they intend, if they have you on their team!Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
Tom Staszak is one of the most professional people I have dealt with in my last forty years of business. You’ve got a great group of people and you have built a truly professional organization.Michael J Polarek, President, Paragon Packaging
We thank you Eric and Generational Equity making our dream come true.Larry Moore, Owner, A Company Portable Restrooms
Bruce and I wanted to take this opportunity to thank Generational Equity for assigning Musa Jagne to our transaction. In Bruce’s words, “Musa did one hell of a job for us!”Karen S. Williams, CFO, BW Manufacturing
Thanks again Phil and feel free to have a future client call me if they would like a referral. You are a true professional!Andy Graham, Vice President, Modern Heating & Plumbing
Michael worked tirelessly, He followed every lead meticulously and urgently to make sure nothing was missed.Robert Evans, President and CEO of Mealtracker Dietary Software
We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
I wanted to write you a quick letter to express our appreciation and our delight on the outcome of helping us through the process of our recent sale. We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.Terry D. Wickman, President, Keytroller
We are extremely pleased with the way Generational Equity handled the sale of our company. Your associates, Tom and Chris, did an outstanding job of getting us (me) through the process.Michael J Polarek, President, Paragon Packaging
I must say that I have never worked with a more driven, competent and focused individual as Don Ho.Jay Dinnison, Owner of Sharpe Mixers
Greetings Mike. Thank you for the captivating and compelling presentation you made at the Phoenix presentation last week. Over many years in business yours was the most informative and well-presented presentation, on any subject, that I have ever attended! Your energy and enthusiasm combined with your concise and captivating support of your positions with easily understood examples and data was compelling.Pete L.
Generational Equity’s assistance was invaluable in compiling and marketing our business.Bil MacLeslie, CEO, ipHouse
I couldn’t have asked for a better team than Michael and Deborah. We couldn’t have done it without them.Robert Evans, President and CEO of Mealtracker Dietary Software
I quickly recognized that Don was working for Sharpe Mixers above all else, and held our interests above others.Jay Dinnison, Owner of Sharpe Mixers
I would like to thank you and your firm, Generational Equity, for being our valued advisors in our journey.Bil MacLeslie, CEO, ipHouse
Generational Equity educated and informed us – so that we could be on the upside of a good decision (to sell).Bil MacLeslie, CEO, ipHouse
The help you provided us during each step of this process made us feel very comfortable and confident we were selecting the right approach to transition our Company.Andy Graham, Vice President, Modern Heating & Plumbing
We knew it would be a difficult task to have someone really understand our business and our market, prior to researching a possible buyer, so it was imperative that we found someone of your caliber, with definite proven experience in this area.Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
I need to say an immense thank you to Don Ho for his stellar work ethic, attention to detail, and tireless effort. Also thank you to the whole crew at GE! Without you, Don could not do such a phenomenal job. We were shooting for closing and funding before the end of 2020, due to the uncertainty of the political landscape and taxes. I am happy to report we closed last week and will be funding tomorrow.Dr. Caty J. Catron PhD, RN, VA-BC – Owner, Vic The Picc, LLC
T.D., thank you so much! You are a great leader! I love how you are using your gifts and talents to better others. You are clearly a GREAT COACH! This 3 day session undoubtedly changed the future of our business, and very well may have been the sole catalyst to save my company, my health and my marriage! A genuine “thank you” from the bottom of my heart.Bryan D. Horn, Owner, Over Under Clothing
Dear Chris and Andre, I just wanted to say thanks for all your help. Even though this process was not an easy one, it was comforting to know that I had a capable team standing beside me. You made me feel like we were almost your only client or at least the most important one. Thanks again, and I will recommend your service in the future.Shenille Engelhart, Owner – CLS Technology
We will highly recommend Generational Equity and Musa Jagne to any business owner about to embark on the same process.Karen S. Williams, CFO, BW Manufacturing
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