'Excellent' times for business acquisitions

A New Zealand mergers and acquisitions expert says there will be excellent opportunities for business expansion in what he sees as a buyer's market.

While an international survey shows fewer businesses are planning to grow through acquisition in the next three years, Grant Thornton NZ's Martin Gray says some should be thinking more positively.

"Acquiring market share from weaker competitors in difficult times may be a rare opportunity to grow your business to the next level," he said.

The latest findings in an international survey from accounting and business advisers Grant Thornton show that 35 per cent of New Zealand privately held businesses expect to grow through acquisition in the next few years, down slightly from 37 per cent the year before and below both the global average (37 per cent).

"The next six months are likely to be a buyer's market, offering opportunities to make strategic acquisitions at attractive valuations. Private equity funds expect 2009 to be a well performing vintage year," said Gray.

He warned any businesses considering an acquisition that it has never been more important than now to use solid due diligence, valuations metrics and ensure correct financing structure is in place to cope with possible downsides in the short term while the economy remains sluggish.