Bass, Berry & Sims attorney Frank Pellegrino authored an article for Industry Today examining the challenges and considerations when selling a manufacturing business in an uncertain market. It underscored three pivotal concepts that can potentially turn these challenges into opportunities: earnouts, timing, and transaction structuring.
Frank underscored the importance of earnouts in bridging valuation gaps, the extended timing of deal execution and the significance of transaction structuring for tax efficiency and estate planning. He also addressed the impact of market uncertainties, such as inflation and higher interest rates, on M&A outlook.
“Selling your business can be enticing, and having an understanding of the process is an important first step to get the most out of the sale – especially in uncertain market conditions,” noted Frank. “That includes anticipating issues with valuation and planning to address those, knowing what to expect and what advisors to consult throughout the process, and how to best structure the deal to meet personal and organizational objectives. Indeed, front-end planning is among the most valuable steps to optimize back-end success.”
The full article, “Considering Selling Your Business?,” was published on May 28 by Industry Today and is available online.