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7
DECEMBER 2016
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The Canadian Business Journal
is whether to sell their business or continue on.
Rarely is it an easy cut-and-dried decision, espe-
cially when so much time and effort has been
spent in developing it.
“The companies we saw had actually put
themselves up for sale and then met who would
likely be the suitors, which would typically either
be their competitors or private equity, but time
and time again the principal owners would
change their minds. The people buying the busi-
ness were either going to try and make it more
efficient as an industry buyer or they’ll load it up
with debt, juice the numbers and then sell the
company for exit returns,” says Reid.
It’s not uncommon for owners to get cold
feet at the 11th hour and so they will often return
to their advisor to say they love their customers
and don’t want to see the company end up in the
wrong hands.
“Because we come from this type of invest-
ing, the advisor will recommend our company,”
says Reid.
During consultation with an advisor the
company owner is told that a Canadian firm (FA
Capital) will buy 60% of his or her enterprise
allowing the entrepreneur to extricate inves-
tors who may be putting the squeeze on to sell.
Additionally, it’s an excellent way to gain liquidity.
FA Capital won’t oversee the business and tell the
owner and managers how to run the operation
on a daily basis. Furthermore, there is the poten-
tial to put in additional funding for such things as
1,2,3,4,5,6 8,9,10,11,12,13,14,15,16
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