Getting around the: "The Seller are only looking at Strategic Acquirors"

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by a searcher from Columbia University - Columbia Business School
in Jacksonville, FL, USA

1yr ago

Getting around the: "The Seller are only looking at Strategic Acquirors"

Am I missing something? I have done > 25 acquisitions (though many 1-2M) and feel like I get this answer a lot. I feel like they are saying:
1. Your money isn't green. OR
2. You are not willing to buy at the stupid multiple the seller wants to sell at.

I have assistants fill out NDA's, but this still eats into their productivity.

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reply by an investor 1yr ago
from University of Pennsylvania in Charlotte, NC, USA

Thanks for the tag ^redacted‌. Any of the previously mentioned reasons could be in play, but if you're sharing your solid track record of completing deals and successfully operating companies of the same size and type, along with evidence of financial support, and they're still gatekeeping, maybe they legitimately expect that a strategic can readily realize cost and/or revenue synergies such that non-strategic buyers aren't going to be competitive. No real loss - makes more sense to pursue opportunities where that dynamic isn't applicable. Or the seller or broker is misguided and best to avoid them.

reply by a professional 1yr ago
from Hofstra University in Nassau County, NY, USA

If the seller can get the "silly multiple" he wants from a strategic, why shouldn't they?

I know there are reasons to avoid the strategic (if you care about your people) but if you are in it for the money, why should you take less from a nonstrategic who can't create the value to pay you what you want?