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A trade sale is an exit in which the buyer is an operating company in the same or adjacent industry — a strategic or corporate buyer — rather than a financial sponsor or the public markets.
Invest Europe uses trade sale for PE exits to industrial buyers. Founders use it the same way: the company sale goes to a strategic / corporate buyer, not to PE.
The economic hook is synergies and capability. The cultural hook is “we understand the customers.” The risk hook is that the buyer is also the competitor who now sees inside the data room.
When it underperforms: one logical buyer, slow corp-dev, or antitrust.
Illustration only.
A diagnostics distributor is sold to a global OEM (trade sale) at 9.5x EBITDA versus PE indications at 7.5–8.0x. The OEM’s IC credits channel access. Works-council process adds 10 weeks. Founders accept a lower cash-at-close mix with an earnout on keeping a key tender — classic trade-sale texture.
A trade sale is still M&A: LOI, diligence, SPA. Do not confuse “friendly industry buyer” with “light contracts.” Strategics can be tougher on W&I than funds.
PE exit statistics; founder processes aimed at 8–15 names; divestitures of non-core units to someone who will operate them.
Confidentiality leakage to customers via the buyer’s sales force. Earnouts that are unmeasurable inside the buyer’s group. “Trade” does not mean domestic — many trade sales are cross-border.
Dazur’s matching tags trade vs financial explicitly and stores the industrial overlap note. A trade-sale process without that note is just a longer NDA list.