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SELECTED EXVERE CASE STUDY
Circuit Technology  Client: Two partners had built a thriving printed circuit board manufacturing business. The industry was experiencing rapid consolidation and numerous inquiries were received to gauge their interest in selling. The owners decided to take control of their destiny by engaging Exvere to institute a formal marketing process to ensure the company was valued appropriately. Delegation of this responsibility allowed the owners to focus on running the business in case no transaction occurred. This paid off since the company was operating at record levels during the late stages of negotiation when that leverage was used to finalize the sale agreement. Challenge: Two major consolidators were dominating the acquisition market and smaller companies were being swallowed up at low multiples of cash flow. Exvere and the owners of CTI believed their situation warranted a premium valuation. Process: Exvere bypassed the major consolidators to focus on rapidly growing second-tier producers. That strategy identified two strong prospective acquirers and a competitive negotiation ensued. Outcome: CTI was acquired by Praegitzer Industries, Inc., a private firm with plans for an IPO. The transaction was structured as cash plus a "convertible put option" contingent upon execution of an IPO within a stated timeframe. This option agreement gave the sellers the right to receive either cash or stock on the IPO date. When exercised, the market value of Praegitzer stock was well above their option price. |
