M&A Trends for 2024: Even More Structured Transactions

If a seller still wants to get a good price for their business in 2024, they will need to be open to a ‘structured transaction’. Among other factors, higher financing costs and banks’ reluctance in certain sectors mean that acquisitions can no longer be financed solely through cash and bank debt. A structured transaction is a deal that involves using complex structures. These include performance-based earn-outs where sellers receive a higher price if their company performs better than expected, as well as other instruments such as vendor loans (subordinated loans from the seller), deferred payments by the buyer, or rollover investments from sellers in the acquiring company to close deals.