When the market cools, selling stops being a balanced exercise.
Over the past two years, rising interest rates and higher debt costs have put pressure on the cash flow of many European companies. Sectors such as retail, consumer goods, and construction are already seeing a significant share of transactions that are not planned sales, but rather forced or accelerated exits. The European Central Bank estimates that more than 30% of European companies have fragile balance sheets. And that inevitably attracts a very specific type of buyer.
The opportunistic buyer is not looking for a fair transaction. They are looking for an advantage. They know that there are solid companies, with well-established brands and capable teams, going through periods of financial stress. And they know that this urgency weakens the seller’s negotiating power.
A fund with available liquidity—what we call dry powder in the industry—approaches a company that needs to refinance debt or close a capital increase on a tight timeline. It arrives with an exhaustive analysis of the sector, knows the numbers better than the management team itself, and presents a fast offer. Sometimes it even looks attractive on the surface. But once you dig deeper, the debt adjustments, conditions precedent, and hard-to-achieve earn-outs hollow out the initial price.
The most repeated argument is the lack of a market. “There are no other buyers.” “The context doesn’t help.” “It’s this or wait two years.” And to some extent, that may be true. But that narrative, repeated insistently, has a clear objective: to get you to accept a multiple far below what was paid three or four years ago for similar companies.
It’s not that there is no money. There is. What’s happening is that a significant portion of that capital is invested in public markets, generating attractive returns through dividends. As long as markets remain high, many traditional investors—both financial and industrial—have little incentive to move that money into less liquid assets like SMEs.
That reduces the number of active buyers. And when there are few players in the market, those who remain have more room to impose conditions.
The result is an imbalance. Companies that four years ago would have sold at six or seven times EBITDA are now receiving offers of three or four times.
They are not hard to spot if you know what to look for.
They focus almost exclusively on your weaknesses. They insist on risks, maturities, and cash flow pressures. They barely mention the strengths of the business or the synergies the transaction could generate.
They impose very short timelines. They want you to sign a conditional letter of intent before you can sound out other interested parties. And if you ask for time, they respond with pressure: “the offer expires,” “the investment committee won’t wait.”
They use comparables to their advantage. They always find a recent transaction where a lower price was paid. They never mention those that closed at higher multiples.
And once you’re already in the process, they renegotiate. This is what we call a retrade: changing the conditions after the seller has invested time, granted exclusivity, and has few alternatives left.
Because selling a company is not something you do every day. Most business owners reach their first—and often only—sale transaction without prior experience, without clear benchmarks, and without a structured process.
Many haven’t even carried out an independent valuation before receiving the first offer. Others rely on what an acquaintance tells them who sold three years ago, without understanding that that market no longer exists.
And when a buyer shows up with resources, a professional narrative, and an offer on the table, the temptation to close is enormous—especially when there is pressure from shareholders, maturing debt, or sheer exhaustion.
The problem is that once you’re inside a bilateral negotiation, without live alternatives, your room to maneuver disappears.
There are no magic formulas, but there are ways to arrive at the negotiation in a stronger position.
The first is to know what your company is worth before talking to anyone. A serious valuation that combines several methods—market multiples, comparable transactions, and discounted cash flows—and that takes into account the size, risk, and liquidity of the business. That number is your anchor. Without it, any offer can seem reasonable.
The second is to prepare a vendor due diligence. In other words, anticipate the buyer’s questions: quality of earnings, normalized EBITDA, tax and labor contingencies, key contracts. If you come to the table with this information well organized, you reduce information asymmetry and take arguments away from the opportunistic buyer.
The third is not to negotiate alone. A well-designed sale process includes several buyer profiles—industrial players, financial investors, family offices, international buyers—and creates competitive tension. It’s not about auctioning your company, but about having real alternatives that allow you to compare and negotiate from a more balanced position.
And the fourth, perhaps the most important, is not to rush. The timelines imposed by the buyer are rarely the real timelines. If someone tells you their offer expires in ten days, ask yourself why. Urgency almost always benefits the buyer.
In these types of transactions, the advisor is the one who defends your position, filters potential buyers, manages the process, and helps you identify when an offer is reasonable and when it is opportunistic.
A good sell-side advisor knows how to read the signals. They know the track record of the funds that approach you. They understand which adjustments are standard and which are excessive. And above all, they have enough experience to tell you when it’s worth continuing to negotiate and when it’s better to walk away.
Because sometimes the best decision is not to sell. Or not to sell now. And that, too, requires perspective.
In a lower-liquidity environment, protecting the value of your company means arriving at the negotiation with solid numbers, a clear story, and a process that does not depend on a single buyer.
Urgency cannot be the driving force behind such an important decision. And if someone pressures you to close quickly, using scarcity arguments and unbalanced conditions, they are probably not looking for a fair transaction.
They are looking for an opportunity.
And that opportunity is you.
The best decision starts with a conversation.
If you are exploring a sale or have received an offer, let’s talk.
Listen on Spotify to the podcast “Negocios con Confianza”, where we discuss this topic in depth.
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