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Will market trends continue for middle market businesses?

On Behalf of | Oct 28, 2015 | Mergers & Acquisitions

In prior posts this summer, we noted how the number of mergers and acquisitions marked a record pace to which many people wondered whether it would continue at such a torrid pace. Essentially, the number of big market acquisitions that were being made, combined with the anticipation that the Fed would raise interest rates, contributed to the opportunities for these transactions to be made.

But for as much success as the market provided for large market businesses, it may not be so profitable or impressive for the middle market. According to a recent report, statistics suggest that mergers and acquisitions for this sector of the market is down compared to last year. 

While there is some debate over what may be considered the middle market (i.e. activity involving businesses with revenues of $500 million or less), there appeared to be a spike in such activity in the latter half of 2014 that has not been duplicated thus far in 2015. There is a curiosity given that the amount of venture capital funding has not plummeted.

What this may suggest is that the epic run that has exemplified the first half of the year may eventually apply to middle market businesses. An informal poll of business insiders indicates that it is still a buyers market. When (and if ) these transactions come to fruition, the expertise of experienced M& A lawyers will be essential. We have noted in past posts how beneficial legal counsel can be in taking a transaction from inception to completion and beyond.