When all else is equal, however, valuations in the current marketplace among private and public companies vary little (when comparing public companies to private companies in M&A transactions).
Our data suggests a variation of just 10 to 20% between comparable public companies and private companies involved in M&A transaction. What's more, public companies aren't always worth more.Note, too, that all else typically isn't equal between public and private companies. If two otherwise identical companies exist, the public company is likely to be less profitable because of the costs associated with complying with the regulations that govern public companies.
Hence, for small companies, it seems that remaining or going private makes the most sense. How small? Let's just say, the smaller the truer this is.
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