Dealmakers say the M&A market is strong. Deal volume doesn’t fully agree.
Capital is there. Buyers are picky.
Private equity has a lot of money to deploy, strategic buyers have room on their balance sheets and lenders are quoting. But the companies closing clean processes have stable cash flow, low customer concentration and clean diligence. Everyone else sees processes drag or die.
If your fundamentals are clean, it’s a reasonable time to go. If they’re not, don’t waste a process. Fix the one thing that will kill the deal in diligence first. The best middle-market deals right now aren’t the highest multiples. They’re the ones that close.
Broad auction or targeted?
Broad auction: more buyers, more competition, a higher clearing price.
Targeted: eight to ten real buyers, tighter confidentiality, a faster close.
The number of buyers matters far less than whether any of them has a reason to pay above market. A strategic buyer with a specific gap in their portfolio will outbid ten financial buyers running identical buyout math.
Both have risks. Broad processes leak to employees, customers and competitors. Targeted processes fail when the list comes from the owner’s contacts instead of real market coverage.
The list is the process. Everything after it is administration.
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