I've been asked to assist in the marketing/selling of an active and profitable Heavy-Lift crane rental business (U.S.). The owner, who is getting up in age, has decided to retire and is looking to sell the business. He's very well respected with a strong client base of repeat customers. Most of the units average approx 2010 mfg date and have been well maintained. In addition to the equipment, he's selling ongoing contracts/projects + contracts that have not yet started. I've managed to put together an extensive list of other crane rental outfits in the U.S. I want to streamline my selling process and condense my approach to a tight list of things that matter to prospective buyers. Here are my questions: 1. What are the most important talking points when approaching a prospective buyer? 2. What is the typical profile of the ideal prospective buyer? 3. Is approaching buyers in Mexico (or other countries) a viable route? Thanks in advance....
This sounds outside the realm of mechanics knowledge.
True, but the operators . . .
It’s been my experience that any company worth buying won’t be a hard sell to people already in that industry or with relevant experience. Is there an asking price in mind? If so, how did he or you get there? I don’t need to know that number but they’re going to ask how much and follow up with how it was figured. Depending on the location and size that should help narrow down where to start. If it’s a $5,000,000 company that casts a wider net, $50,000,000 narrows it down quite a bit lol. Contracts and reputation fall into a blue sky category for me, it’s hard to put a value on them. Yes the contracts are with that company on paper but often it’s the person the creates the connection and often those don’t pan out after new owners. I know people in that business all over the country, heck one might even be a buyer depending on some of the details.
The crane and heavy lift company owners know who all the players are. Word of mouth on large companies is the usual marketing strategy if the company is to be sold intact. In this case all the home work has to be done up front. A detailed inventory of all the assets and their locations is one of the big hurdles. If it is a big company working in multiple states, that can be a big issue. A point man who is in charge of all the assets has to be set as the contact point for the appraisers and inventory people. Heavy lift companies amass so much stuff in rigging and components that it might take months or longer to find and catalog everything. The asset book will be huge and it will be your most important selling point. The temptation is to use accounting book values for the assets but you need realistic market values. Has a price on the entire company been set yet? Will the pending sale affect on going and upcoming projects? Should the employees know about what is happening? All those decisions need to be made behind the scenes before you start nosing around for potential buyers. Word will get out and it should be a company announcement and not the rumor mill where employees learn about it. Lots of stuff disappears when employees don't know if they will have a job tomorrow. You can advertise in the trade rags if you want to go international in scope. Crane Trader, Machinery Trader and Rock and Dirt work OK if you are going to piece out the fleet. You said you have already scoped out the players in this country so it's possible to do a broadcast email to let the players know whom to contact. What is your time frame for the sale? A multi-million dollar company is going to take awhile. I worked a bankruptcy of a large heavy lift company several years ago and the inventory alone took more than a year.
Thanks for this info. Helpful. My primary task is to simply bring people to the table and hand them off to the owner for further discussion. I readily confess that I DO NOT have the experience or wherewithal to take it any further than that. However, I do consider myself adept at perusing the landscape and making meaningful contacts. There is indeed an extensive list of heavy-lift units and parts. The business is being sold with a live book of business either in process or coming online in the near future. FMV (per company accountants/consultants) is $25 million.