While cash acquisitions do occur, they are very rare in the lower middle market space in particular. Nearly every deal comes with financing. Quite often, SBA financing, which is good, but with certain deals there may be even better alternatives.
Over the next ten years, it’s likely that no fewer than one-half of successful, privately owned businesses will have a transition of ownership. Some will give up minority interests for new investment, while many more will sell majority control or essentially 100% of the assets of their companies.
It’s interesting to see what motivates business owners to come and seek legal assistance for the first time. Often, it’s due to unexpected litigation that a business has to defend.
I try to make careful distinctions about the legal categories we use when it comes to the issuance of securities or of raising money as contributions.