F Reorganizations in Lower Middle Market M&A
Lower middle market (“LMM”) M&A transactions frequently involve F reorganizations (“F reorgs”) of S corporations (“S-corp”). F reorgs are often a critical part of structuring the purchase and sale of S corporations. If you plan to take your S-corp LMM business to market and anticipate the transaction will be structured as a stock sale, you […]
Trends in Lower Middle Market M&A- The Use of Sell-Side Quality of Earnings Reports
Through our involvement as a buyer in private markets, we have noticed a trend of sell-side Quality of Earnings (QofE) Reports becoming more common in lower middle market (“LMM”) M&A deals. While LMM buyers routinely use QofE reviews during diligence, LMM sellers have been increasingly using a detailed quality of earnings analysis to help maximize […]
Rollover Equity in Lower Middle Market M&A
Owners of lower middle market (“LMM”) businesses contemplating a sale or majority recapitalization should be aware of trends in rollover equity in M&A transactions. As a seller of a LMM business, you may be expecting to have a full exit from your business at the closing table. Sellers may be surprised when their investment banker […]