It is time for your business to attack or defend?
After a tumultuous 12 months, the world economy appears to be starting to rebound. Australian GDP increased by a strong 3.1% in the December 2020 quarter.
Naturally, many business owners have been looking internally over the past year. Is it now time to expand or exit?
Endeavour Capital is seeing a noticeable uptick in the number of parties seeking an acquisition, both industry players and financial investors. The industries that are active include: information technology, healthcare, safety, defence and manufacturing.
The professional acquirers will have a dedicated team internally or will appoint a corporate adviser to undertake targeted search. Reactive acquirers will just sit back and wait for deals to hit their desk.
Even if you are not considering an acquisition or sale, you should be aware of the potential changes in the market dynamics of your industry that follow from an acquisition by a competitor or private equity group. Will these changes make you more or less relevant in the market? Typically, the more relevant the higher the value and, sadly, less relevance equals lower value.
I have often used the analogy of the tour de France. Strong cyclist will attack on the hills, forcing weaker competitors to either burn their limited energy trying to maintain contact with the leaders or drop off the pack. I believe we are at a similar time now.
Make sure you make a deliberate decision on attacking or defending.
Peter Wallace
Endeavour Capital
Business sales / acquisitions | Business valuations | Corporate Advisory
Sydney | Melbourne | Brisbane | Newcastle
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