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With interest rates at an ebb, M&A activity is on the rise. Is now the right time for you to jump in and catch the wave?

This story appears in the June 2006 issue of Entrepreneur. Subscribe »

Last year was a good one for wheelers and dealers, as M&A activity reached $1 trillion, up from $824 billion in 2004. This year's numbers are expected to surpass that, assuming interest rates remain relatively low. But is this particular rising tide lifting all boats? More specifically, is now a good time for entrepreneurs to either cash in their hard-won profits and positive cash flow by selling for a pretty penny or use their own surplus to acquire a smaller company that might help them expand?

Eric Gebaide, managing director of Innovation Advisors, an investment banking firm in New York City that focuses on the middle market, says it is. He notes that while they don't get the same media attention as the major mergers, acquisitions involving smaller companies accounted for a significant portion of the 10,700 transactions rung up in 2005. "When you say the M&A market is robust, it is that $20 million [and below] deal size that has been the most robust," he says, adding that technology, medical devices and manufacturing have all been especially busy industries.

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