Now that over 45 days have passed, it is safe to assume that we have heard of most merger & acquisition transactions that were completed in 2012. At least in the Green Industry, we can hardly call the fourth quarter activity strong. This was, in some respects, highly surprising given the common expectation that the scheduled increases in both capital gains and ordinary income tax rates along with the implementation of a 3.8% tax on unearned income would lead to a rush to complete transactions prior to year-end before the increases came into effect. How well we know that what really happened was that the political wars were in high gear during the last couple of months of 2012 as the “fiscal cliff” drama. For the most part, small business owners, no matter their personal political persuasion were disappointed in the failure of the Congress and the administration to compromise and move forward. Although we have had a brief respite, the airways are filling with the nearly unpronounceable word “sequestration” and it sounds like the “fiscal cliff” all over again.
Personally, I wonder if our country’s leadership understands the cost of all of this brinkmanship and uncertainty on the business community. If they really understood the toll this all takes, it is hard for me to believe they would not reach a positive compromise and move forward.
In general, the merger & acquisition market place is beginning to shows signs of life, with large transactions like Warren Buffett’s acquisition of Heinz and the mergers of American Airlines and US Airways and of Office Depot and Office Max in the news recently. We are hopeful and see some signs that M&A activity in the green industry may increase as well.
As always, if you are considering selling or buying a green industry business or you are ready to begin developing your exit plan, we welcome the opportunity to discuss your situation confidentially. Just give us a call or send us an email.
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Ron Edmonds of The Principium Group is the author of three books of special interest to green industry business owners:
For more information about these titles or to order copies from the publisher, click on the links above.