2013 merger and acquisition activity levels are expected to be robust, reports Bob Sweeney, president, Innovative Travel Acquisitions, Inc. (ITA), based in Alpharetta, Georgia, a major broker.
Sweeney says that ITA represented six sellers who closed transactions in December 2012 who represented a combined sales volume of $190 million.
"Mergers and acquisitions activity in the year ahead will be driven by an aging ownership population in most sectors of the travel industry and a slow but sure economic recovery," Sweeney says.
"Promising new sectors are developing rapidly such as medical tourism with hospitals and insurance providers buying into the new reality of healthcare. Space tourism should be strong in 2014, " Sweeney said.
"We operate in a huge industry that is consolidating at all levels small, medium and large. Another noteworthy trend is international corporations are showing interest in acquiring USA based travel related companies," Sweeney said.
"Foreign individuals can also gain fast track into the immigration process if they buy an American business that will provide jobs to U.S. workers," he notes.
"Another trend is that disgruntled corporate types who have been laid off 2 or 3 times in the past decade are buying small and mid sized travel companies," Sweeney said.
Sweeney's ITA has handled over 500 mergers and acquisitions since the firms founding. He also offers some advice for possible mergers and acquisitions, including:
1. Keep quiet and be sure prospects sign a non disclosure document prior to sharing information. A business known to be for sale loses value.
2. Provide prospects with the past 24 monthly income statements, including all add backs and non recurring or extraordinary expenses such as legal fees, moving costs, personal automobile, cell phones, club memberships and owners travel and meals.
3. Be in tune with reality based current value of your business prior to listing.
4. Present a solid professional package of data for the buyer to examine after non disclosure agreement has been signed including flow charts, business procedures manuals and a list of preferred suppliers.
5. Never only talk to one buyer. After all those years of building for an exit be sure you consider multiple offers. Why limit opportunities?
6. Use an industry specific attorney and broker for best results.
ITA is a member of ASTA and NTA.
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