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M&A Nuggets: Patience, Young Grasshopper

Patience is a virtue.  In the 1970s television show, “Kung Fu”, David Carradine portrayed a character who had been trained as a monk in China.  The character’s mentor often conveyed words of wisdom, including “Patience, Young Grasshopper”.  In the M & A context, patience is important.  After a modest downturn in M & A activity in the second and third quarters of 2020, M & A activity has picked up briskly.  Potential buyers, especially private equity firms, own plenty of cash and demand for acquisition targets by buyers outstrips the number of sellers.  This has resulted in generous valuations in certain industries, such as health care technology.  From a seller’s standpoint, however, the time may not be right to sell.  Valuations in other industries have been more modest, along historical lines.  Every seller needs to ask whether the current stage of the seller’s business and personal life is the right time to sell.  If the purchase price proposed by a buyer is modest and the target company is very profitable, it may make sense to wait to sell.  That way, the owners can enjoy several more years of substantial profit distributions and then embark on a sales path.  For good companies, there will always be buyers.  Sometimes, the virtue of patience should govern the sell or hold decision.

If you have any questions about this or any other M&A issue,
please contact Glenn Solomon at gsolomon@offitkurman.com or 443-738-1522.


gsolomon@offitkurman.com | 443-738-1522

Glenn D. Solomon is a principal at Offit Kurman and has provided counsel to businesses and business owners for more than twenty-five years. He has extensive experience in the purchase and sale of businesses, structuring ownership agreements, and advising companies in financial distress.


At Offit Kurman, we are our clients’ most trusted legal advisors, professionals who help maximize and protect business value and personal wealth. In every interaction, we focus on furthering our clients’ objectives and provide timely services and within budget, all while focusing on the clients’ interests and goals.

Offit Kurman is one of the fastest-growing, full-service law firms in the United States. With over 230 attorneys offering a comprehensive range of services in virtually every legal category, the firm is well-positioned to meet dynamic businesses’ needs, as well as the needs of the people who own and operate them. We also provide representation of individuals and families in diverse matters ranging from estate planning and asset protection to intellectual property structuring and entrepreneurial start-ups. Our International Group provides clients with a broad range of services for transactions and dispute representation for clients worldwide, including Europe, Canada, Asia, Latin America, the Middle East and Africa.

At Offit Kurman, we distinguish ourselves by the quality, breadth, and global reach of our legal services — as well as our unique operational structure, which encourages a culture of collaboration and entrepreneurialism. The same approach that makes our firm attractive to legal practitioners interested in representing clients in the middle market, also gives clients access to experienced counsel in almost every area of the law and in many jurisdictions in the U.S. and abroad

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Author: Glenn Solomon Esq.
Articles have been Reprinted with permission from the charlotte observer and Mike Hunter.

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