Babson Finds M&A Has Improved

“It is a very good time for entrepreneur owners to begin planning for their capital event.”

That is the theme of the Babson College Middle Market/Small Business Mergers & Acquisition Survey conducted by the business school’s MBA students in the first quarter of 2013.  The report was released May 15th, according to Ed Towers, a Master Intermediary with an M&A advisory firm in Naples.  The President of Tiger Brokerage Group, Mr. Towers quotes that the research shows that “Mergers and Acquisitions has significantly improved in the past two years”.

The Babson Survey in collaboration with members of the Association for Corporate Growth (ACG) and Exit Planning Exchange (XPX), assess and defines current trends that impact buyers and sellers of businesses.  The survey population included leading national middle market investment banks, large business brokerage firms, advisory professionals, and commercial bankers.

Ed Towers reports that among the survey’s key findings:  First, it is still a sellers market for quality companies.  Second, financing for buyers continues to grow and terms are more acceptable.  Third, for smaller deals, there has been a strong rebound in SBA loans especially from community banks that will help contribute to the growth of small business deals moving forward.  Fourth, the services industry sector remains the strongest with increased activity reported in e-commerce, health and medical services, aerospace and related industries.

The Babson Survey also reports that “Sellers need patience and must be prepared with information and the ability to respond quickly to buyer requests to increase chances of closing deals within six months.  Like buyers, seller success is dependent on acquiring the right legal and deal-making expertise.”

The survey by Babson “projects an increase in the number of opportunities for every type of middle-market financing.  This is good news for private equity buyers when balancing leverage versus equity contributions for new M&A deals”.

Towers says that the Babson Study confirms the International Business Brokers Association (IBBA)/Pepperdine University survey released last month.  The IBBA study found that business brokers foresee an upswing.  “Business brokers who responded to the survey say overall they are optimistic the industry will provide more sales in 2013.”

Babson College is the education, convener, and thought leader for Entrepreneurship of All Kinds!

Tiger Brokerage Group puts together buyers and sellers of privately held businesses throughout Florida.

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