The number of announced acquisitions of privately owned companies increased from 6,438 in 2014 to 7,077 in 2015 (a 10% increase), reveals the newly released 2016 Mergerstat Review. The purchase of privately held companies is a significant component of merger and acquisition activity, the report points out
Key drivers: Private firms are being acquired for several reasons. The owner lacks an heir to take over the business and, nearing retirement, needs to sell to achieve liquidity for investment diversification and estate tax purposes. Another common reason for sale is growing pains. Increasing demand for the company’s products or services puts pressure on the firm to become more sophisticated and efficient in its operations. To fulfill these demands, the owner/entrepreneur sells the business to obtain needed financial resources for expansion.
BVR offers a complimentary download of selected data from the 2016 Mergerstat Review, which includes some stats and a table of acquisitions of privately owned companies. The download also includes a complete Table of Contents and a full List of Tables.
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