MIAMI—The vast majority of independent public relations firms have been approached multiple times to discern their interest in selling, and about half expect to sell sometime within the next three years, according to research conducted by New York-based law firm and presented at PRovoke16, the Global Public Relations Summit in Miami.

Those numbers come from research conducted by Davis & Gilbert in partnership with The Holmes Group and are based on more than 100 responses. Three quarters (75%) of responding firms have been approached about selling their firm and almost as many have been approached three times or more. More than half (57%) have been approached at least once within the last year.

And half (50%) thought it was likely or very likely that they would sell their firms within the next three years.

Not surprisingly, the most important factor in the decision to sell was for the owner to obtain personal financial reward and secure a personal exit strategy. The next highest ranking factors were obtaining "expanded career opportunities for employees," followed by obtaining "additional management expertise."

When asked who they would prefer to sell to, answers were mixed. The largest number (23%) said they would prefer to sell to a large independent PR firm, while 13% indicated that their preferred buyer was a large PR firm that is part of a holding company; 12% indicated that their preferred buyer was a consulting firm; 11% would like to sell to a digital or social media agency, and another 11% would prefer a small or mid-size PR firm; 9% would like to sell to a large publicly traded company that did not already own a large PR firm.

Respondents gave the lowest preference to the possibility of selling to a private equity firm or to an advertising agency, with each being the preferred buyer to approximately 7% of respondents.

When it comes to seeking outside help, agency principals acknowledged the need for a "specialized lawyer" and a "specialized accountant." Other advisors, in order of importance, were: the company accountant, a broker, networking with peers, and industry trade association leaders.

The top ranking areas of concern were "placing an accurate value on the firm" and "identifying the best buyer." The next highest ranking area in which outside advice was needed was "understanding the purchase price structure and working capital requirements," followed by "identifying potential liabilities."

Respondents also ranked the areas in which they had the least knowledge about the sale process. The two top ranking areas were "the percentage of the purchase price customarily paid on closing" and "the tax consequences of an M&A transaction." The next two highest ranking areas on which respondents needed additional knowledge about the M&A process were in understanding "the manner in which the value of their firm impacted on the personal financial planning of the owner," and the "manner in which the corporate entity of the respondent's firm impacts the structure of a possible deal."