- Oil Industry was plummeting.
- The second company was upside-down in inventory and accounts payable, and was headed into foreclosure
- The seller’s ex-partner, brother & son were not agreeable to the terms of the letter of intent
- Seller was going through a complicated divorce
- Successful marketing efforts lead to over 550 Buyers looking at this business during the oil bust
- Received several letters of intent (LOIs) within weeks of seller engagement
- Was able to get the buyer up to $15 million from an initial bid of $7.5 million + $3,000,000 for seller’s second company for a grand total of $18 million for 80% of the company
- Negotiated a salary plus benefits, plus equity, for the seller
This oil-manufacturing business in Houston was actually two companies: one offshore, one onshore. The offshore one was quite successful, even during a time when oil prices were plummeting. The onshore business was struggling for a multitude of reasons. The business structure was very complicated. For example, the seller’s ex-partner in the business owned the real estate. Things were made difficult because the ex-partner was not negotiating in good faith.
During the selling process, the owners did not always listen to the advice given by the experts at Seiler Tucker. For example, Seiler Tucker informs all sellers and potential sellers not to tell employees, clients, vendors, etc. that owners are selling their business. Despite this, the seller told their employees, resulting in one key employee demanding more compensation in order to stay. Other potential problems arose.
Nevertheless, many buyers saw the potential in the businesses, and several buyers wanted to bid on it. The deal involved a series of complicated negotiations with the buyers and sellers, uncovering losses, ensuring that payables were paid, and dealing with personnel problems. However, in the end, the business was successfully sold because Michelle Seiler Tucker and her team persevered through it all.
“I have higher standards than anyone else in the industry,” she says. “Most M&A advisors/business brokers don’t show up unless they are needed. In fact, many do not show up at all. I show up for everything. It’s a business broker’s job to create a win-win for both the buyer and the seller.”
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