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BUSINESS Saturday 28 July 2018
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Hot item for sale at small companies: The business itself

By STAN CHOE process from an attorney
Associated Press and the selling company's
NEW YORK (AP) — For many broker, as well as a Small
small businesses, the easiest Business Administration
thing to sell right now might loan provider. One of the
be the business itself. biggest lessons: "Every-
Buyout activity is booming, thing takes longer than you
and the prices being paid think," he said. "Estimate
are at or near records for how much time you think
companies up to $50 million it's going to take and add
in value, brokers say. Many to it."
small-business owners are Some other considerations
fielding more cold calls small business owners
asking if their companies should keep in mind:
are for sale, and owners — If there's a time to sell,
who do put their businesses this may be it.
on the market are often re- "A lot of times the owners
ceiving multiple bids. wait a little too long to sell,"
"I've been doing this for 20 said Everett. "They wait until
years, and I can say that the business starts to stag-
if this isn't the top market, nate, and then they think
it's the top one or two in of getting out." But own-
recent years," said Scott Tom Szold, Chief Executive Officer at Precision Safe Sidewalks, works from a coffee shop on Fri- ers will always get a better
Bushkie, principal at Cor- day, July 27, 2018, in Alexandria, Va. price when their business is
nerstone Business Services, Associated Press growing.
a mergers-and-acquisition — Selling doesn't have to
firm based in Wisconsin set the price for a compa- months. Everett, finance professor mean leaving.
that works with lower mid- ny is to look at its earnings "It's really unprecedented, at Pepperdine Graziadio Jeff Kaplan, the founder
dle market companies. before interest payments, not only the volume of Business School. "With the of cloud-service provider
"You've really got the stars taxes, depreciation costs deals, but the competition tax and regulation environ- Breakthrough Technology
all aligned." and amortization, which is for deals," Shea said. "We're ment a little bit more busi- Group, had long declined
Among those stars: Com- called EBITDA. excited to be on the buy ness-friendly now, maybe calls from potential acquir-
panies that want to grow In the first three months of side, but we also take into that's delayed the change ers as he focused on build-
may see an acquisition the year, the typical pur- consideration that it almost in valuations. But it seems ing the business. But he re-
as the easiest way to get chase price was 6.1 times reminds you of the hous- like everyone thought that cently decided he wanted
trained workers amid a EBITDA for a company val- ing market: Are we at the the valuations would be a more national scope, so
tight labor market. Lower ued between $5 million peak?" going down by now, and it he sold a majority stake to
taxes and lighter regulation and $50 million. That's up by Still, Shea and brokers hasn't." Abry Partners, a private-
have improved sentiment. more than a third from four across industries say they Small business owners are equity firm, in December.
On top of all that is a gen- years earlier, according to don't see signs of the mar- selling to people like Tom A few months later, Break-
eration of Baby Boomers surveys from the Interna- ket cooling. Even recent Szold, who had been work- through Technology Group
looking to sell and retire. tional Business Brokers As- increases in interest rates, ing in public affairs but merged with another com-
The market is so hot that sociation, M&A Source and which would seem to be a always wanted to run a pany owned by Abry, Nex-
Bushkie has heard some the Pepperdine Private deterrent, haven't dented business. He joined with his usTek.
prospective buyers say Capital Markets Project. deal activity. If anything, brother and a friend in May Kaplan, now chief reve-
they're interested in a pur- In the insurance industry, they may have pushed to buy Precision Safe Side- nue and strategy officer at
chase, but they're too busy prices have neared 12 some buyers to make their walks, which helps city gov- NexusTek, says he doesn't
at the moment with other times EBITDA, said Mike purchases before rates ernments and other cus- miss being the owner of his
acquisitions. Shea, president and CEO moved even higher. tomers identify where their own business, in part be-
The jump in activity has of Shea Barclay Group. His "You would think there trip hazards are and how to cause the company now
pushed prices up. One tra- company has made three would be a tipping point" fix them. has roughly 10 times more
ditional way that brokers acquisitions in the last 16 from higher rates, said Craig He got help through the employees.q

Nod for Disney's $71.3B

acquisition of Fox entertainment

Nod for Disney's $71.3B ac- Marvel's X-Men and Aveng- dropped out last week fo-
quisition of Fox entertain- ers franchises and creates cus on attempted buyout
ment an entertainment behe- of the European pay-TV op-
Associated Press moth in the digital stream- erator Sky.
NEW YORK (AP) — Disney's ing era. The shareholder The Fox deal will help Disney
$71.3 billion acquisition of vote caps a saga that be- compete with technology
Twenty-First Century Fox's gan in December 2017, players like Amazon and
entertainment division is when Disney made its first Netflix.
one step closer after share- offer for part of Rupert Mur- The agreement is not ex-
holders approved the deal doch's media conglomer- pected to close for several In this Aug. 8, 2017, file photo, The Walt Disney Co. logo appears
Friday. ate. It kicked off a bidding months and still requires on a screen above the floor of the New York Stock Exchange.
Associated Press
The tie-up brings together war with Comcast, which regulatory approvals.q