As CNN Money said June 16, 2014, “the corporate world is in the midst of a grand shopping spree!” To that date in June there had been $786 billion worth of mergers and acquisitions in the United States. That challenges even the 2007 year – known in the M&A world as the last “big spender” year.
As Reuters said June 30 of this year, “Investor support for large acquisitions and a desire to trump rivals in consolidating markets have led to deal volumes at their highest level in seven years.”
Quoting Goldman Sachs in June, “Companies have strategic imperatives to do deals, they have the cash to do deals, and they can borrow additional cash at record-low rates. It really is a bit of a perfect storm when it comes to dealmaking.”
The super-large transactions that command headlines today, may jump ahead of the normal pricing modes of the middle market American business. However, when money is as available as it is today, and competition is booming as companies compete for growth, there will always be opportunities for the home run sale, that may make the long term “norms” pale by comparison!
Who is hitting the true grand slam of a lifetime in this economy? Companies with a proprietary lead position in a growing segment can command the prices of a lifetime. Companies which do something unique or special in how they “go to market” – to get goods to customers more quickly, and to provide product tailored to the shifting demands of customers, are golden! Companies with command of systems and resources well ahead of competition, hold valuable advantage, and are competitively desirable beyond all others in the competitive marketplace.
Competition produces prices that can far exceed any “normal” pricing norms. And, in a robust economy, timing can produce results that may not be comparable with anything 10 years or more, in either direction.
If timing looks close to right, for you, as a business owner, consider moving today. 2014 appears likely to be the year of the century!