ILOGI top-notch Virginia’s IT staffing and Employment agency (Staffing M&A) which is a leading organization that matches employers to employees.
In developed countries, there are multiple private businesses which act as employment agencies and publicly funded employment offices.
Our company, ILOGI has an efficient & outstanding team of hardworking professionals specialized in profile matching as per our client’s needs. We deliver the best-fit acquisitions in the shortest time possible. Our team of recruiting specialists after a deep study of our client’s needs provides the best-suited staff that helps them save costs and enhance quality with maximized efficiency for their business.
The number of announced U.S. staffing industry M&A transactions began to recover in the third quarter of 2020, as deal discussions have resumed. 27 staffing industry transactions were reported in Q3 2020, an increase from the 20 announced transactions in the second quarter of 2020. 85 staffing industry transactions were reported in the first nine months of 2020, down 24% from the 112 transactions announced in the first nine months of 2020. Many staffing deals that were previously placed on hold are coming back to market again and we will likely see an increase in the number of completed staffing M&A transactions both in Q4 2020 and as 2021 progresses.
The staffing M&A market remains highly bifurcated, as buyer demand is strongest for companies who continue to perform well though the pandemic. These companies are most likely to be in the professional staffing sector, including high-growth segments such as IT, life sciences and healthcare staffing. Deal activity is substantially lower within commercial staffing segments such as light industrial and hospitality, as companies in these segments have suffered significant revenue declines in 2020. Potential sellers in these segments are more likely to hold off on transactions until growth and profitability improve.
On the professional staffing side, transaction multiples have remained steady, as there continues to be a growing number of well-capitalized buyers (many owned by private equity) who are seeking higher quality assets that strategically fit with their business. Private equity-backed companies will continue to seek growth opportunities through both organic and inorganic means in order to build value for their own future exits, even if those exits have now been delayed by a few years. With this imbalance between the higher number of active buyers and scarcer number of available sellers, this could be an especially good time to bring a professional staffing company to the market.
Most U.S. public staffing companies continue to be absent from recent M&A activity, as staffing industry acquisition activity remains primarily driven by privately held strategic buyers (many of whom are now majority owned by private equity funds). Of the 85 staffing transactions completed in the first nine months of 2020, 71 were completed by privately owned investors / buyers, with only 14 of these transactions completed by publicly traded companies.
Strategic buyers (which include staffing businesses that are owned by private equity) completed 85% of the staffing acquisitions in the first nine months of 2020. However, private equity buyers continue to be an attractive option for the larger and faster-growing companies in the staffing sector, with 13 new platform investments made YTD September 2020. This follows the 65 new platform investments made by private equity in the staffing industry from 2017-2019, as previously reported by Duff & Phelps. Contract staffing companies with scale and excellent historical and projected growth rates, and management teams who want to continue participating in the growth of their businesses post-transaction can still be very attractive investment platforms.
IT staffing, especially businesses with more relationship-oriented sales model producing higher gross margin and double-digit EBITDA margin, remains the most attractive staffing segment for acquirers. Of the 85 transactions reported in the first nine months of 2020, 37 involved companies whose predominant service offering was IT staffing and/or IT consulting. Healthcare staffing is another historically attractive sector, with 12 transactions completed in the first nine months of 2020. Professional staffing segments (including IT, digital / creative, healthcare, finance / accounting, and life sciences) continue to see the most buyer demand in the industry. The light industrial staffing segment was active prior to the pandemic, although typically at lower valuation multiples as compared to higher-margin professional staffing. As light industrial staffing is generally viewed as more cyclical than the staffing industry as a whole, buyers in this segment will likely be more opportunistic moving forward.
ILOGI is one of the top IT staffing agencies in Virginia which specializes in all levels of staffing and recruiting services. Our experts connect job seekers to various outstanding companies for IT, accounting, administrative, human resources, professional, health care and creative positions.
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