Executing a transaction requires balancing the objectives of both the buyer and the seller. These objectives can be financial and strategic, with successful outcomes emerging when both buyer and seller find alignment.
Understanding each party’s motivation is essential. Sellers may be influenced by succession planning or liquidity needs, while buyers often seek strategic expansion, new capabilities, or market access. Transactions are most effective when these underlying motivations and needs converge.
Timing is also critical. Deals depend on aligning temporary windows of readiness between both parties, where interests and market conditions coincide.
Financial considerations, such as valuation, structure, and performance metrics, must coincide to establish feasibility. However, non-financial factors such as cultural compatibility, leadership continuity, and employee arrangements often determine whether a transaction succeeds after closing.
In essence, liquidity emerges in that middle ground where buyer and seller priorities overlap. The broader this intersection, the stronger the foundation for a successful transaction.
Elaxtra Advisors is an M&A and value-creation advisory firm that assists institutional investors, private equity-owned platforms, and strategic acquirers invest and create value in worldwide technology services companies. Please contact us to explore potential partnerships.