Who handles small acquisitions and mergers?

This might seem kind of small, but my company is planning on acquiring a very small company (less 1MM revenue). Who do we contact for something like this. Would a CPA handle this type of stuff or a commercial bank?

Thanks ahead of time guys.

16 Comments
 

See we're a small company, but I'm pushing the boss to acquire a small company locally which would allow us to really amplify our estimation and bidding abilities. Seems like we might hit up a small boutique shop here in Dallas or even nationally.

Really pushing the 'ascend by acquiring' or 'build by buying' strategy to my boss.

"It is better to have a friendship based on business, than a business based on friendship." - Rockefeller. "Live fast, die hard. Leave a good looking body." - Navy SEAL
 
Best Response

$1MM rev, what's ebitda and what's the multiple you're acquiring at? A service business in construction ancillary services like bidding/estimating should be relatively high margins, maybe 30%+ so even at 10x you're at $3MM and I'd probably only pay half that in cash and maybe some earnout over a floor of rev or ebt on that business unit. If there isn't currently a broker or bank involved I'd do it without an intermediary who will only add 3-5% to the cost. There's value in a business broker to get a good price if you're selling but most aren't adding a ton of value once the buyer is in place and most decent IB's won't dip that low unless the buyer or seller are already clients. Consult a decent CPA way below the Big 4 level and use a decent lawyer who will do it at a fixed fee schedule rather than hourly.

edit: sorry, I read that as you already identified a target, not that you're looking for acquisitions. If you're looking for companies in that range reach out to all of the business brokers and local boutique IB's. Don't engage them per se, just ask what they have and tell them what you're looking for and say you're actively looking. In that range, however, you and your boss are probably the best source for deals especially if you're looking at a more local level (i.e. if you're in Dallas there's no reason looking for estimators in Seattle so you probably know who's good in your area). Look at who you do business with, competitors, etc. and start talking to them. Let your industry network quietly know that you're looking for acquisitions. If you're looking how to finance them, that's a more in depth discussion.

 

This is exactly what I needed. Thanks Dingdong.

Wish I could SB more than once.

"It is better to have a friendship based on business, than a business based on friendship." - Rockefeller. "Live fast, die hard. Leave a good looking body." - Navy SEAL
 

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