Relevant Background Information:
A Mexican IT company hires us to do a Due Diligence and negotiations with a potential buyer. Our client had four founding partners, approximately 400 employees and 15 years progressive growth in their market. The potential buyer was a very powerful Mexican company, with global presence and more than 7,000 employees.
How to structure the company presentation so that we could obtain fair value and adequately reflect the intangible assets. Unfortunately, the historic numbers showed that there was stagnation in the commercial results from the last three years and had an EBITDA, which was lower than the average in the industry.
Upon rejecting a significant, fair market offer, the partners addressed Due Diligence issues and eventually changed their corporate culture. After reorganizing some areas and restructuring their compensation plan, the sales have doubled and the EBITDA is above industry average. Today, only three years later, their company is growing internationally and is easily worth 3 to 4 times the previous offer.