THE RIGHT TIME TO SELL YOUR COMPANY

The right time to plan your exit strategy is all down to your own personal and business circumstances.

It is important, however, to understand the value of your business to others, not just to yourself.
Of course, the best time for you may not be the best time overall and we believe it is imperative to take advantage when the market is in your favour.

The following seven reasons show why there has never been a better time to sell your business:

  • The Government’s actions

    The new Conservative government have previously taken certain steps in order to reduce the budget deficit. The clarification of corporate tax policy has created a better stage for M&A activity as it is seen to provide greater stability for businesses.

  • Buyers looking to diversify

    Buyers have recently been acquiring businesses from other sectors in order to diversify, especially over the last two years. This is also apparent within the recruitment sector, with companies aiming to enter into new or emerging markets.

  • Strategic acquirers

    Due to the current climate, buyers are looking to strategically invest in companies that show valid opportunities to increase market share. These types of transactions are seeing an increase above the current market level of multiples.

  • Wealthy companies

    Large numbers of cash-rich companies that have experienced recent success, retaining profits during the recession, have funds to invest in new acquisitions. Many have acquisition budgets already in place to fund new projects, which creates a sellers’ market.

  • Overseas buyers

    The current weakness of sterling and the decrease in interest rates has resulted in assets within the UK being acquired by international buyers. At Recruitment Mergers we have seen an increased demand for the acquisition of UK-based companies, particularly from the US and Europe.

  • Minimised taxation (Entrepreneurial Relief)

    A key reason why business owners are looking to sell is Entrepreneurial Relief. Sellers are now only being taxed 10% of any proceeds up to £10m, compared with the 40% rate seen in previous years. With the Conservative government being elected for another term we expect this to remain at current levels.