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August 2011
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November 2011

Graphic - Cash for M&A growth in company cash balances

Cash holdings for nonfinancial members of SandP Cash balances in larger corporates have built up steadily since the financial crisis are folk husband their resources carefully.  I've often commented on how such large accumulated cash balances in have become a driver for M&A "post" financial crisis.  

They say a picture is worth a thousand words - well I've found a chart that illustrates the cash balances growth very clearly.  

The graphic which is from Capital IQ via Deloitte shows cash balances fairly static up to the autumn of 2008 since when they've grown strongly.

How can I sell my business for maximum value?

Exit For most busines owners once they've begun to think about exit strategy "how do I get the best price" is often top of the list of questions.   We're addressing that at a series of three seminars this autumn entitled Business Exit Strategies.    They're being held on 3rd, 10th, and 24th November in Hemel HempsteadNorthampton and Brentwood.   These are half day free seminars designed to demystify the topic and to offer genuinely practical insight and ideas for business owners.  For full details and the ability to book easily and confidentially visit our website.

For those owners who want a decent price but also the ability to acheive a sale to their management team to reward the people,  and to secure continuity we have a special session in the seminar on this topic.  Its an area we specialise in and we'll be sharing some pracitcal advice and some real case studies.

What type of company will appeal to buyers during a recession?

They say the cream rises to the top. 

And especially in a recession buyers tend to look to quality.  Some questions to ask.

  • Can the business be scaled beyond any real or perceived dependence on the owner?
  • Does the business have its own proprietory products or services?
  • Is there a strong management team which will stay on after a sale?
  • Does the company have a defensible niche in the market?
  • What about the customer base, how long have they been trading with the company - is there a good story on customer retention?
  • Is the businses model underpinned by recurring revenue streams?
  • Does the busines have growth opportunities?
  • Are operating margins strong, and are they holding up?
  • What risks does the businss face and are they manageable?
  • Are the accounts in good shape, and does the businesas have good systems?