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COVID-19 Update

Accelerated Manufacturing Brokers, Inc. is continuing to provide our full offering of services to clients despite the challenges we are all facing due to the COVID-19 outbreak. 

AMB is now back in our offices. 

We have the necessary systems in place that are enabling all our office employees to be safe and protect their health and safety and those around them.

If you have any questions, please do not hesitate to reach out to us at 908-387-1000.

Please stay healthy and remember we are all facing the same challenges together.

 

Frances A. Brunelle

Frances A. Brunelle, President
Fran@acceleratedmfgbrokers.com

908-387-1000 — info@acceleratedmfgbrokers.com

Manufacturing M&A in 2021 – The Market Pulse Report

M&A in 2021

I’ve previously written about how COVID will affect the sale of manufacturing companies.  As we rounded out the first quarter of 2021 I opined on the state of the market, which you can read HERE. Now there’s third-party evidence on the state of Manufacturing M&A in 2021 with the Market Pulse Report, by Pepperdine University.

This report covers ALL businesses, not just manufacturing companies, which typically rank highest in these reports. Here are some interesting highlights that manufacturers should be aware of

What’s Selling?

Manufacturing & Engineering made up 32% of the sales in the $1MM-$2MM business size.

Manufacturing & Engineering made up 48% of the sales in the $2MM-$5MM business size.

Manufacturing & Engineering made up 46% of the sales in the $5MM-$50MM business size.

This is great news for manufacturers. Respondents report a lack of quality businesses on the market, so private equities are participating in competition to acquire smaller companies.

Where are Prices Trending?

At the close of Q1, lower middle-market companies were trending at 107% of benchmark pricing. Larger companies commanded higher prices. Overall, across all size companies and sectors, businesses sold at 91% of benchmark pricing.

Lower middle market EBITDA multiples jumped to 5x from 4.3x in the same quarter for 2020.  This is for ALL sectors – manufacturing companies usually rank higher.

Who is Buying?

In the $2MM – $5MM range – first-time buyers, serial entrepreneurs, and existing companies led the way

For companies in the $5MM – $50MM range, PE firms and strategics were most often buying.

In both cases, the majority of buyers came from more than 100 miles away. This has been very consistent in the sale of lower middle-market manufacturing companies for some time and why it’s important that you work with someone who has a national audience.

This is all great news for manufacturers who were afraid of pricing due to the pandemic. The other major concern we’re hearing from potential clients is whether they can sell before the tax hikes and the answer is YES. You can read more about that HERE.

About Frances Brunelle

Frances Brunelle is the founder of Accelerated Manufacturing Brokers, Inc., which specializes in the sale of lower middle-market manufacturing companies nationally. Fran and her team help to ensure the continuity of U.S. Manufacturing by transitioning ownership to the next generation of entrepreneurs. Recently Fran was named to 2020 Most Influential Women in Mid-Market M&A (Mergers & Acquisitions). Fran is also the host of the WAM (Women and Manufacturing) podcast, a Jacket Media production. Fran writes on topics that help manufacturing business owners prepare their companies for sale and navigate the sale process to ensure a positive financial result in support of their retirement.

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