Officer measured what practitioners had long asserted: acquisition multiples for stand-alone private companies and unlisted subsidiaries sit well below those paid for comparable publicly traded targets. His explanation is the price of liquidity: owners selling a private company are often selling because they need or want liquidity that the asset itself cannot provide, and constrained, thinly shopped sellers accept less. The discount varies with how badly the seller needs the money and how competitive the sale is.
The Institute’s reading: read alongside Fuller, Netter and Stegemoller, this is the same coin from the seller’s side. For buyers it explains where the bargain comes from, and warns that the bargain shrinks as processes professionalize. For sellers it is the strongest academic argument for the unglamorous preparation this site keeps prescribing: reviewable financials, reduced owner dependence, and enough runway to sell on your schedule rather than your circumstances, because urgency is the discount’s best friend.