First, strategic buyers may be able to realize synergistic benefits almost immediately due to economies of scale that may exist through the combined purchasing power of the new entity and the elimination of duplicate functions. Second, strategic buyers are generally larger companies with better access to capital. They often have another currency available to them in the form of stock. Strategic buyers often offer stock, cash, or a combination of the two in payment of the purchase price. In short, the strategic buyer is buying the company in light of how it will enhance their existing operations.
Strategic buyers are much less likely to retain all of the current personnel.
Whether a strategic buyer or a financial buyer is right for a specific company depends largely on the seller's goals in selling the business. Listed below are different scenarios discussing the seller's goal and the type of buyer most appropriate. The Seller Wants the Highest Price Possible. If the only goal in the sale is achieving the highest price possible, regardless of what happens to the plant or employees, the open auction process is the best way to drive the price upward. And obviously, with highest price being the only goal, the strategic buyers will most likely be the best fit.