Buying an IFA businesses usually involves raising additional money. According to Acquisition...
Buying an IFA businesses usually involves raising additional money.
According to Acquisitions Mergers and Sales Ltd (AMAS), which specialises in matching buyers and sellers, raising the funds to make an acquisition usually involves the buyer's own bank(s) or perhaps money from the City.
Larger IFA businesses will likely look towards the latter – indeed, may be forced to go that route if already listed on the stock exchange as any fund-raising will have implications for shareholder value.
Part of any funds raised will have to be used for legal and other costs – something both buyers and sellers must think about.
The timeframe for closing any deals will also need to be borne in mind.
The more clear a buyer is in terms of his/her criteria, the faster they are likely to find the type of business they want to acquire.
Deals can take between three months to one year to complete, but a typical deal should take about 6 months from start to finish.
AMAS says the M&A market is growing as the number of buyers and sellers keeps rising in tandem, which means there are likely to be increasing opportunities for buyers to meet sellers and vice versa.
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