As 1998 wound to a close amid an apparent flood of private-company sales in this region, one could sense a kind of end-of-an-era feeling in the air. At Chagrin Valley Country Club, a group of two dozen or more regulars are said to play golf for $150 a game. Their affinity? All the participants have sold their companies. Meanwhile, when executive recruiter Mike Gerbasi of Garfield Hts.-based Sager Co. was informed of the sale of yet another Cleveland-area company late last year, he was moved to wonder aloud, “Am I going to be the only guy working next year?”

What was it about 1998? Did the raging bull market and its paper riches, along with plentiful credit from banks and burgeoning private equity groups, combine to make ’98 the peak of the company selling season? Or are we witnessing the ushering in of a different era, one in which the brisk trade in the sale of private companies is a standard, continuing feature of business in Northeastern Ohio?

Long-time M&A specialist Russell Warren expects it’s the latter.

“In this area, there are just so many companies, it’s like an evergreen crop,” says Warren, former chairman of the mergers & acquisition committee for Ernst & Whinney (now Ernst & Young LLP), and subsequently founder of The Transaction Group, Cleveland-based consultants in M&A transactions. “I think of it much more in the forestry model. Every week, we learn about people who want to do things” such as sell their company.

Warren expects no let-up in the pace of deal activity in the region. “Almost weekly, we are called by players in New York and other distant places, because they know this is a good, fertile crescent for good companies,” he says.

While the flood of private equity capital sloshing around the economy (see box) unquestionably fuels much of that activity, the heightened pace of mergers also seems to be tied to a different generational psychology than an earlier breed of company founders who worked till they dropped. In their place have sprung a different kind of owner, one more likely to sell his or her company off well before retirement age before going on to other pursuits. “Owners are turning companies over faster,” says Frank Novak, a partner in The Transaction Group.

Behind much of the faster cycling, Warren suspects, is the relentlessness of technology. “We call it the technology poker game — you’d better ante up, or the game’s over” for stand-alone companies, he says. “The only thing that’s constant [with the technology curve] is acceleration. And the only thing that money buys you is a shorter lead time before you have to do it all over again.”

The man who keeps track

If you’re engaged in the business of buying or selling companies in Northeastern Ohio, sooner or later you’ll probably have occasion to call Ed Crawford, chairman and CEO of Park-Ohio Co. And when you do, he’s keeping track.

“I sat there one day and said, ‘Every time I turn around, I’ve got somebody else competing with me’” in the buyout business. As representatives of various groups contacted him about this or that proposed deal, he kept a list. “I started adding them up,” he says. He stopped counting when he got to 36 private equity groups. “Ten years ago, there were about six,” he says.

Despite the crowded field, Crawford’s not complaining. “I get a lot of deal flow from that.”