Equity Partners HG is a leading middle market investment banking firm specializing in helping lower and middle market companies navigate tough financial situations.
It’s been a record-setting year for the mergers and acquisitions market globally. Through the first nine months of 2018, the total value of these agreed-upon deals is in excess of $3.3 trillion. That’s a 39 percent increase over 2017 levels according to the Financial Times. But with each merger or acquisition, one of the key questions becomes how is this going to be paid for? Will it be in cash or stock. With merger mania on people’s minds, let’s look at the benefits and risks as well as pros and cons of these payment considerations.
During a merger or aquisition, due diligence is a critical stage in understanding the risks and liabilities the target company or new entity may face. Lawyers, accountants, investment bankers and other experts review contracts, financials and countless other documents to ensure they know all the details about the companies involved so there aren’t any surprises once the deal closes. But due diligence is taking on new characteristics as the internet takes on a prominent role for most businesses.
While investors might not be noticing, there is a significant shift occurring within the private equity industry — and these changes could benefit the performance of their portfolio. Firms have turned their attention to implementing resources and services to help streamline fund administration processes.
The 2017 Tax Cuts and Jobs Act is perhaps the signature legislation of the Trump administration. For individuals and joint filings, it completely overhauled the tax brackets as well as the amount to be paid. This is in addition to changes to estate tax deductions, revisions to deductions for large medical expenses and many other updates.