Successful business owners who want to sell their company, or better position themselves to acquire others, should consider the potential benefits of partnering with, or selling to, a private equity firm.
Besides buyouts, most private equity firms also utilize “recapitalization agreements,” which can provide owners with significant advantages over selling to a corporate buyer:
- Business owners receive an upfront cash payment, allowing them to “take some of their chips off the table”
- Management team and outside professional advisors remain in place
- To facilitate strategic growth, private equity firm helps with add-on acquisitions, and shares expertise, contacts and other resources
- Business owners retain some equity in the company post-closing, providing them a potential “second bite of the apple” when the private equity firm later divests (liquidity event)
Private equity firms also bring committed capital, access to financing, and transactional experience and know-how to the table. Their deals often close quicker than acquisitions by corporate buyers.
Learn how HSC helps successful business owners achieve their strategic growth and exit objectives.