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

searcher profile

February 05, 2025

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

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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commentor profile
Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
^redacted‌ thank you for the tag. I usually recommend getting pre-approved and presenting the most professional offer that you can. Some want strategic acquirers because they believe they can get a higher multiple that way because there will be cash flow savings for the strategic buyer which will allow them to pay more. The question is whether this push is coming from the seller or the broker. I have found many sellers do not like some of the requirements they will see from strategic acquirers or they do not want their employees to lose jobs. Again, I would try to put the best offer forward showing you are pre-approved and your related experience and see what you hear back. Good luck.
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Reply by an investor
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.
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