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You are here: Home / M&A / M&A Weekly Digest – July 20, 2012

M&A Weekly Digest – July 20, 2012

July 20, 2012 By Lindsey Perkins Wade

This week’s M&A Weekly Digest discusses why private equity firms focus on the lower middle-market, how similar businesses can have different valuations, and the options that the Ansoff Matrix suggests for growing your business. Click on the headlines to read the full articles.

Private Equity – Why It Focuses on the Lower Middle-Market

“Another source has confirmed what we have said before: Private equity firms love to invest in lower middle-market companies…[F]or the first five-plus months this year, lower middle-market companies (Preqin defines this as being companies valued below $250 million) have accounted for 80% of all deals closed by equity firms. This is the highest mark during the period shown since 2009.”

Valuing A Business vs. Selling A Business

“[W]hy do two companies in the same industry with similar projected growth opportunities and profitability often have widely divergent valuations?

The answer is simple: One company is more “saleable” than the other. Another term we use for this is being “buyer ready.” Company A and Company B could have similar post-recasting financials and perhaps even the same growth opportunities. However, Company A has been built from day one with the end game in mind: to be properly positioned so that buyers perceive it as more attractive than Company B.”

The Ansoff Matrix – Options for Growing your Business 

Get your creative juices flowing with “the Ansoff Matrix. Created by the father of strategic management philosophies and mathematician, Igor Ansoff, it was first published in the Harvard Business Review in 1957. Even though the matrix is now more than 50 years old, it still applies to business management today.”

© 2012 Generational Equity, LLC All Rights Reserved

Don’t put off planning your financial future. Learn about selling a business with Generational Equity‘s whitepaper, Selling A Business – Finding Buyers.

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Filed Under: M&A, M&A Weekly Digest Tagged With: ansoff matrix, growing a business, middle market, middle market private equity, private equity firms

About Lindsey Perkins Wade

Lindsey Perkins Wade is managing editor of The Private Business Owner.

The Private Business Owner – A Generational Equity Blog

The Private Business Owner is an online publication sponsored by Generational Equity. PBO aims to provide useful tips and information that will improve both the lives and businesses of entrepreneurs, as well as provide valuable insight into the company exit process through bi-weekly M&A Digests.
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