Businesses are changing hands left and right across the United States in 2017.
Business acquisitions happen all the time, and rarely make national headlines unless they involve a tech company with a household name. But when a prolific restaurant chain purchases another historically successful restaurant chain — that shakes up the business world a little bit.
According to Business Insider, Roark Capital Group, which owns Arby’s Restaurant Group, has agreed to purchase Buffalo Wild Wings for an incredible $2.9 billion.
The private-equity firm will spend $157 a share in cash for Buffalo Wild Wings, which is 34% above the company’s closing stock price as of November 13. Buffalo Wild Wings’s stock climbed 6.5% in premarket trading and has surged 33% since Roark Capital Group’s initial approach.
“Buffalo Wild Wings is one of the most distinctive and successful entertainment and casual dining restaurant companies in America,” said Paul Brown, CEO of Arby’s. “We look forward to leveraging the combined strengths of both organizations into a truly differentiated and transformative multi-brand restaurant company.”
Though major acquisitions like Buffalo Wild Wings result in much more media coverage and consumer interest, the buying and selling of small businesses across the country has been a topic of interest as well.
According to BizBuySell.com’s Insight Report, roughly 7,842 businesses were sold in 2016. And Small Business Trends states that the recent purchasing of small businesses has reached an all-time high in the fourth quarter of 2017.
For young business owners, selling a business is one of the best ways to quickly raise large amounts of capital for other endeavors. In order to take out a typical bank business loan, the business owners must have been in business for at least two years, have at least $250,000 in revenue, be cash flow positive, and have both good business credit andpersonal credit.
Of all the states where businesses are being purchased and sold, California holds the most activity at 21%, possibly because it’s home to most of those tech companies with household names. California is followed by Florida at 14%, New York at 9%, and Texas at 7%.
And despite the tech industry’s reputation for high profile mergers and acquisitions, the retail and service industries are actually the two main sectors of company acquisitions and mergers (with retail dominating with 51% and service at 36%). Additionally, not only are more businesses being sold in 2017, but these companies are also going for much higher prices as well. The freight, moving, and delivery market, for example, has seen its median sale price reach nearly half a million dollars ($497,000) this year.
The bottom line: 2017-2018 may be an excellent time to put your business on the market.
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