Lower-Middle Market Attracts Investors
Indiana University’s Kelley School of Business alumnus Matthew Brunstrum is a key member of Sun Acquisitions, a Chicago-based advisory firm focusing on mergers and acquisitions. As an advisor, Matthew Brunstrum supports sellers and buyers looking to profit from the booming lower-middle market sector.
The diversity and higher volume of lower-middle market businesses have made them an appealing investment, especially for merger-and-acquisition-focused investors. By some estimations, seven out of 10 lower-middle market businesses will be involved in an M&A transaction by 2018. Several factors are driving this growing market.
Many small business owners in the Baby Boomer generation are reaching retirement age, and selling off their companies as a result. Further, since the annual revenue of lower-middle market companies doesn’t exceed 100 million, these transactions are generally less complicated and more cost-effective than acquiring a middle market company in the same industry.
Another benefit is that investors can spread the same amount of capital across several acquisitions rather than one. This allows the investor to identify and coordinate the best practices from each company, making the overall business more dynamic and competitive.
