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Positioning Your Company for Sale

Positioning Your Company for Sale. Presented By: Pierre Villere. Positioning Your Company for Sale. Why Are Companies Sold? What Do Companies Being Sold Look Like? Family Owned Businesses Partnerships Divisions of Multi-National Companies. Positioning Your Company for Sale. Reasons:

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Positioning Your Company for Sale

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  1. Positioning Your Company for Sale Presented By: Pierre Villere

  2. Positioning Your Company for Sale Why Are Companies Sold? • What Do Companies Being Sold Look Like? • Family Owned Businesses • Partnerships • Divisions of Multi-National Companies

  3. Positioning Your Company for Sale Reasons: • Multigenerational company - Somebody wants out • Succession issues • Estate Tax issues • Division not a good fit/hard to manage

  4. Positioning Your Company for Sale The Decision to Sell – The Process • Valuation • Watch out – you may get what you want to hear • Understanding the Value Today vs. Value Tomorrow • Hiring an intermediary – does it make sense?

  5. Positioning Your Company for Sale So You’ve Decided to Sell • Getting Your House In Order • What is “Recast EBITDA”? • Net income • Plus interest, taxes, depreciation/amortization • Plus addbacks

  6. Positioning Your Company for Sale So You’ve Decided to Sell • Addback issues • Inventory issues • Other “Private Company Expense” issues • The 10-to-1 Rule • Preparing the “Book” • Records • Rumors

  7. Positioning Your Company for Sale Who Are the Buyers? • In Your Market • Multinationals • Super-regionals • Large local player • Two others like you

  8. Positioning Your Company for Sale Where Is The Industry Headed? • Consolidation is the keyword

  9. Positioning Your Company for Sale The Sale Process • Negotiated Transaction vs. Auction • Tour of operations/visits with management • Negotiating the Letter of Intent • Main purpose is to lay out principle terms of deal • Standstill agreement is key component

  10. Positioning Your Company for Sale The Sale Process Definitive Agreements and Due Diligence • Audit process • Stock vs. asset purchase • Employment/Non-Compete Agreements • Representations and Warranties • Disclosure Schedules • Environmental analysis

  11. Positioning Your Company for Sale The Sale Process Definitive Agreements and Due Diligence • Geological analysis • Real estate – title, etc. • 360 degree due diligence • Timeline

  12. Positioning Your Company for Sale The Closing Process • Certain items may be renegotiated at the end • Emotions run high at the end – keep them in check • Keep your eye on the ball – get the deal closed

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