HOW WILL THE EXPECTED WAVE OF BABY BOOMER RETIREMENTS SHAPE M&A?
It may come as some surprise, given the current high frequency of deals, that Mergers & Acquisitions are just as susceptible to economic cycles and principles as any other industry. Many factors, including the supply of businesses for sale, the availability of credit, and the liquidity of acquirers, have significant impacts on the volume of deals in a given period. Perhaps no economic force has been studied and forecast quite so vigorously over the past 10 years as the impending Baby Boomer retirement. It is estimated that approximately 75 million baby boomers will be turning 65 at a rate of 10 thousand per day for the next 15 years, based on U.S. Census data. This translates to over 4 million businesses facing a potential succession event in the next 10-20 years. This anticipated wave of activity has significant strategic implications for both sellers and buyers of private businesses.