This business had been started by one of the two Director / Shareholders and had grown rapidly to achieve a revenue of approximately $8M and an EBITDA of $2.5M.
The second Director and 50% shareholder had advanced the company a total of $3M over several years in order to facilitate the growth potential of the business. He was effectively a passive investor / shareholder with limited day to day input into the business. This director had reached the stage where he wanted to consolidate his business interests and exit his shareholding.
Acting as advisor to the directors, I was able to identify an investor who was an ideal fit for the business and who complemented the original founder of the business. They became business partners and the company was restructured to allow the investor to take over the available shareholding and recapitalise the business at the same time as allowing the retiring Director an orderly and profitable exit from his investment.
The new investor went on to become the majority shareholder and the business went on in subsequent years to triple its revenue and profitability. This was achieved through an aggressive expansion process that enabled the business to develop and grow its own retail division to complement the existing import and distribution activities.
This business had belonged to the original owner for many years and had been started as an adjunct to the primary business of property development. The business had been run under management for a period of over 40 years. The company’s existing CEO had been appointed by the owner eight years previously. Over a period of time the relationship between the owner and the CEO had deteriorated and, due to the revenue of the business dropping from $4.2M to less than $2.8M, profitability was at an all-time low. In addition, the reporting and compliance aspects of the business had all but broken down and the previous staff level of over 120 people had been reduced to 80 as a direct result of employee dissatisfaction and corresponding high levels of staff turnover.
Alchemy Consulting was engaged to do a full investigation into the business and its employees, make recommendations and then oversea the Business Transition Period as caretaker managers.
The CEO and the General Manager were both found to be negligent and lacking both the willingness and competence to run the business effectively and were subsequently terminated.
Alchemy Consulting was then able to identify and engage suitable replacements and manage the role handovers for the new CEO and General Manager on behalf of our client.
Some months later the business had responded favourably to the new initiatives, with staff problems addressed, clients back on side and profitability returned.
We then entered into negotiations, on behalf of the owner, with the new management team and a third party financier. We were eventually successful in facilitating an offer and managing the process for a Management Buyout of the business and its assets.
Alchemy Consulting was engaged to advise on the options available to the Directors of this business who wished to retire. They had owned the business for 13 years and were unclear on the best course of action to create their desired outcome. They had had several unsolicited possible offers for the business but none had come to fruition or ended with an agreement.
We prepared a Market Value Appraisal for the business and made recommendations to the directors based on a variety of possible options and then advised on both the strategy and process required for each of these options.
We were then asked to approach key staff members as well as key suppliers and ascertain various scenarios for both directors and staff to ensure minimum disruption to the business and the intellectual property represented by the various parties.
We were also able to identify several potential investors that we considered to be a natural and compatible fit for the various stakeholders.
We subsequently facilitated an introduction and advised on the negotiations that resulted in the successful transition process to the new owner of the business and resulted in a very positive outcome for the Directors and staff of the company.
Contact me now to find out how we can solve your problem and why one of my favourite sayings is:
"I know hundreds of ways that don’t work."
"I know hundreds of ways that don’t work."
m +64 (0)274 764 224
PO Box 739Shortland StAuckland1140New Zealand
© Copyright 2021 Alchemy Consulting. Built by Webtrix. Powered by Airsquare.