The mergers and acquisitions (M&A) market is hotting up, and there is "huge competition" between trade buyers and private equity buyers.

That's according to Katie Folwell-Davies, director of corporate finance at Deloitte, speaking at the Perriam and Everett M & A seminar in London last month. Among other deals, she recently advised Whitehead Mann on its management buyout. Private equity firm Och-Ziff Capital Management provided much of the funding for this deal.

She said the market was probably somewhere in the middle of the cycle. Private equity buyers didn't tend to buy at the bottom of the cycle, she said. But equally, the fact that they are "throwing lots of money at the recruitment sector tells me there's a long way to go".

She said specialist businesses were attracting higher premiums. They are more attractive than "me-too" businesses. But potential buyers can be put off businesses that are over-reliant on a single customer. "A diversified customer base is important," she said.

However, the quality of the management in the business being acquired was even more important.

Sean Geraghty, partner at law firm Dechert, offered advice to those selling a recruitment business. He said lawyers' fees for the sale of a £50m business would be "in six figures" with the same again for accountants. Fees for corporate finance expertise are contingent on whether the deal goes through, he said.

He warned that confidentiality was critical. A certain amount of confidentiality is implied in any negotiations about the sale of a business but "it would be mad not to have something written down".

He advised holding back "crucial trade secrets" until the very late stages of the process.

Uzair Bawany, managing director of Contact Recruitment Group, advised those contemplating acquisitions: "Do some basic research on the firm by indirectly approaching their clients." He also advised looking into the reasons why the vendor is selling.