INDUSTRIAL DISTRIBUTOR (22M)

The Situation

Our client was competing with national competitors in a price sensitive industry. The owner borrowed money for working capital that he ultimately used to fund the losses of the business. He began to lose key employees.

The Process

Next Point focused on the owner and quickly framed the issues, options and gaps and what he personally had at risk. Continuing to personally invest in the business was no longer a viable option. We worked with the owner to develop and evaluate several options that included bankruptcy, wind-down of the company and liquidation of its assets, or finding an outside strategic buyer. Our client determined his best option was to find a buyer, but Next Point needed time to execute that process. While working through the divestiture process on an expedited time frame, Next Point simultaneously acted as a liaison with the company’s bank, vendors, customers, and other stakeholders to negotiate acceptable terms for keeping the business running so that it could be sold as a going concern.

The Turning Point

The company quickly received five letters of intent from strategic consolidators to evaluate. The company was sold to the largest public company in the industry which happened to have additional capacity and was already delivering different products to the same customers as our client. The business owner was able to preserve his personal net worth.

Services Performed

Distressed Business Sale