Corporate Finance in Atlantic Canada

Commentary on corporate finance issues for small- & mid-market private companies in Atlantic Canada

Archive for January 2013

NY Times: How the Sale of a Business Can Go Terribly Wrong

leave a comment »

http://boss.blogs.nytimes.com/2012/12/13/how-the-sale-of-a-business-can-go-terribly-wrong/

“The moral … be sure to hire advisers who have experience and are competent at what they do.  This is especially true when it comes to selling a business.  You can spend years building a business, but you generally get only one shot at selling it.” 

Interesting NY Times article on what can go wrong with the sale of a business.  From a US perspective, but still relevant in our market.

Written by Dan Jennings

January 31, 2013 at 10:01 am

Is now the “perfect” time to sell your business? It depends …

leave a comment »

http://www.theglobeandmail.com/globe-investor/investment-ideas/now-may-be-the-perfect-time-to-sell-your-business/article5661285/

This article in the Globe and Mail lists a number of reasons why this may be the “perfect” time to sell your private business, such as not having to ‘fight’ through another possible recession, being wary of the tax implications of selling and beating the ‘rush’ of baby boomer sellers who will be coming to market in the coming years.

While I don’t disagree with any of these reasons, and I also agree that the timing of your decision to sell is critical, I personally believe there are so many issues to consider that now may not be the ‘perfect’ time to sell for many entrepreneurs.  For example, the personal decision of what the entrepreneur will do with his/her free time after the sale can be terribly relevant to the sell decision … may not be relevant to a buyer’s pricing or purchasing decision, but it is very important to many sellers.  Also, the consolidating nature of your industry (or not) can mean the difference between a ‘fair’ price from financial buyers and a ‘super’ price from strategic buyers, so timing the decision to sell in your industry can trump all other factors (for some businesses).

There is one reality in today’s marketplace that is an important part of the decision to sell, and that is the fact there are many more potential buyers than sellers for quality, small and mid-market businesses in the Maritimes (in some cases, three times as many buyers).  ‘Quality’ can mean different things in different situations, but the overriding criteria are typically having a profitable track record and the ability to transition the existing owner/manager to a new buyer.  Since much of the art of selling a business is matching supply with demand, this over-balance of buy-side demand must be considered in any decision to sell.

As with all complex decisions, the answer as to if this is the ‘perfect’ time to sell is mult-faceted and often begins with “it depends” …

Written by Dan Jennings

January 31, 2013 at 9:37 am

Galvanizing deal

leave a comment »

http://azzgalvanizing.com/sites/default/files/documents/AZZ%20Q3%20FY2013%20FINAL%20010913.pdf

Texas’s AZZ incorporated (NYSE:  AZZ) has acquired Dartmouth’s G3 Galvanizing, owned by Darren Nantes and family.  AZZ has been consolidating the hot dip galvanizing industry across Canada and the US.

Written by Dan Jennings

January 15, 2013 at 2:16 pm

Posted in Announced Transactions

Tagged with

Security industry deals

leave a comment »

http://thechronicleherald.ca/business/393575-wilsons-hits-gas-on-security-expansion

The Chronicle Herald has an interesting story on Wilsons Security Systems, a subsidiary of Truro-based Wilsons Fuel (the home heating oil company that is well known as a sixth generation family business).  The story discusses that Wilsons have branched out into home and commercial security solutions, including several acquisitions over the last two years (the latest being Dartmouth’s AML Security late in 2012).

Sounds like a strong consolidation play and a natural fit for the core heating oil business.

Written by Dan Jennings

January 8, 2013 at 9:02 am

Posted in Announced Transactions

Tagged with

PEI pharma deal

leave a comment »

http://www.biovectra.com/news.php?id=71

http://ir.questcor.com/releases.cfm

Los Angeles-based Questcor Pharmacenticals (QCOR on Nasdaq) is acquiring the shares of PEI’s BioVectra for $50 mil in cash (plus up to another $50 mil in earnout consideration).

Questcor is a biopharmaceutical company focused on the treatment of patients with serious, difficult-to-treat autoimmune and inflammatory disorders.  BioVectra is a supplier of contract manufacturing services to the pharmaceutical and biotechnology industry.

Written by Dan Jennings

January 4, 2013 at 11:59 am

Posted in Announced Transactions

Tagged with

Do you know your Sellability Score?

leave a comment »

Our firm recently launched sponsorship of a free online planning tool called The Sellability Score.

The Sellability Score software uses an advanced algorithm that weighs dozens of different variables to determine how easy it would be to sell your small or mid-market private business.  Developed by John Warrillow, author of “Built to Sell: Creating a Business That Can Thrive Without You”, this software will tell you how your business would stack up if you tried to sell it today.

Consider taking the 15 minute “Sellability Score” quiz and find out:

  • The Sellability Score of your business, including where it ranks on the scale of being easy or hard to sell.
  • Your best options for selling your business depending on your score.
  • The most important (and often overlooked) questions you should ask yourself to determine if your business is ready to sell.

In particular, we see this tool as a way for entrepreneurs to enhance or improve the value of their businesses long in advance of when they might want to sell.  For example, if the software identifies that reliance on the owner/manager is one obstacle to selling the business and maximizing the price, we can then show the entrepreneur how to remove (or mitigate) the risk of that happening (hence, enhancing the value of the business today).

Consider checking it out.  http://sellabilityscore.com/raymond-yuill-chartered-accountants/dan-jennings

Written by Dan Jennings

January 2, 2013 at 5:21 pm

Posted in CF Musings

Tagged with ,