The entire atm business is one simple excel sheet with maybe 6 rows in it. That’s the case if you are just looking at the basics. When you start dealing with all the non financial variables, you’ll quickly start lowering the valuation of the deal.
In terms of maximizing the deal for the buyer AND the seller, you need to purchase routes where you are local to the area. Once you start purchasing locations that are not close, you start incurring costs of doing business that will devalue the deal for you and the buyer. What many sellers forget is that their bottom line number will be different than the buyers. If its not tilted in the buyers favor, the deal falls apart. Furthermore, in the atm business, there are naturally more potential buyers than sellers (the keyword is potential). Sometimes a simple lock on the atm (changing over manual locks to elocks for instance) can be enough to through a sale off.
At the end of the day, the buyer has the power when buying atm portfolios. The biggest mistake an ATM seller makes is simple, they never created their businesses with an exit strategy. As a result, the buyer can easily find holes that will enable him to lower the valuation, if you know where to look!
It all comes down to mitigating risk, and within the atm business (especially from the buy side), that’s my specialty!
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