Why Up-Market, Down-Market Acquisitions are different
September 15, 2010: (TMA International Headquarters)
Buyers like distress sales because “distress” translates into “value pricing.” Similar to used cars, which sell at significant discounts in part because of the risk of buying a lemon, distressed companies sell at significant discounts in part because of the risk that the buyer inherits unknown liabilities. The key to completing a successful distressed acquisition is handicapping and then limiting the risk of those unanticipated liabilities. Read more