14 May Around the Web: A Week in Summary
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A recent article from Axial entitled “Structuring Transactions Post-Coronavirus — COVID-19 Virtual Roundtable” offers highlights from a recent virtual roundtable with 10 middle-market deal professionals discussing how deal structure has been affected by the Coronavirus.
Key topics discussed include:
- How are perspectives on virtual diligence evolving?
- Lenders taking more conservative posture
- For existing deals in the pipeline that are sponsor deals, are debt providers going back to the sponsor for additional equity contributions to get deals done?
- Private equity firms focused on maximum flexibility
- Dynamic between buyers and sellers re: difference in valuation conversations prior to and after coronavirus
- New standards for environmental health and safety due diligence post-COVID
- How are sellers dealing with repricing and retrading of deals in progress?
- Sellers are showing flexibility and understanding of the circumstances
- Need for lengthened diligence period
- How much diligence can be done virtually? Will you close a deal without meeting in person?
A recent editorial from The Washington Post entitled “A Misguided Assault on Mergers” discusses proposed legislation that would temporarily limit mergers.
The Pandemic Anti-Monopoly Act would prohibit all large mergers, mergers involving hedge funds, and mergers involving private equity firms until the FTC determines that consumers and small businesses are no longer under severe financial distress.
This proposal could have a major impact on mergers large and small, severely limiting deal activity for an unknown period of time.
A recent article from business.com entitled “10 Need-to-Know Tips for Selling Your Business in 2020” offers helpful advice for business owners considering a sale. Whether the sale is imminent or a long ways away, it’s best to start planning sooner rather than later for this complex process so that you can set yourself up for success.
The article discusses the following 10 tips:
- Determine your business value.
- Seek legal and financial expertise.
- Keep it quiet.
- Hire a professional business broker to help you with listing your business for sale.
- Set a realistic asking price.
- Get the paperwork in order.
- Separate your personal expenses from the business.
- Get your offers in writing.
- Tidy up your curb appeal.
- Tie up loose ends.