Corporate divestitures differ from the sale of private companies in many ways, and an advisor who is aware of those differences is best positioned to achieve an excellent outcome for his or her corporate clients. Some of those differences include positioning carve-out financial statements, negotiating a transition services agreement and understanding the different needs and requirements of a corporate versus a private shareholder.
Whether we are overseeing the sale of a product line, business unit or corporate subsidiary, we combine our decades of experience with industry research and management discussions to gain a comprehensive understanding of the industry’s dynamics and the divestiture candidate’s competitive position.
Corporate divestitures may not have the necessary standalone financial information needed to present the business for sale. We work with the corporate parent’s outside providers to develop these statements and present the business in the most favorable, yet realistic, light.
A business unit that is being divested may not have a sufficiently complete, experienced and motivated management team to effectively accomplish a divestiture. We work with the corporate parent to identify areas where the management team needs to be strengthened and properly incentivized.
Prairie, in consultation with the corporate parent, develops a sale process designed to achieve the corporate parent’s goals given the constraints of the situation. This may be a broad auction of the company to both strategic and financial acquirers or a more targeted approach focusing on a select set of potential acquirers.
Regardless of the types or number of potential acquirers, Prairie prepares high quality, professional materials to market the business in the most favorable light considering the company’s strengths, weaknesses, opportunities and threats.
From our first interaction with the potential client until closing, Prairie’s Managing Directors remain actively involved in the sale process.