Three Phase Liquidation Strategy Nets Almost Three Times Expectations
Client: High Performance Racing Components Manufacturer
Challenge: Deploying the Right Sale Strategy at the Right Time to Maximize Results
When one of the world's largest and best known independent manufacturers of camshafts, valve train components and electrical ignition systems for the performance car and motorcycle racing industries encountered financial difficulties, AccuVal was engaged to value the company's machinery and inventory. When the company shuttered operations, AccuVal's sister company, LiquiTec, was engaged to sell the assets.
AccuVal and LiquiTec® Approach
The key to successful asset dispositions is deploying the right sales strategy at the right time. In this case, LiquiTec recognized that the name recognition, proprietary designs and goodwill accrued by its client in the more than fifty years of service to professional and sportsman-level motor sports enthusiasts was of real interest and value to existing competitors. It is for this reason that great care was taken in assembling, cataloging and securing very detailed information regarding all of the company's intellectual property so qualified buyers would have all of the information needed to knowledgably enter into a competitive bidding environment.
Immediately upon being engaged, LiquiTec began a negotiated sale process by bundling all of the company's assets and offering them to the marketplace. Quickly recognizing that buyers were slow to declare interest, LiquiTec structured a custom sealed bid process and invited all interested bidders to participate by submitting a substantial, nonrefundable deposit to be applied to an acceptable bid. As a result, serious buyers were forced to pronounce themselves or risk seeing the assets sold to another bidder. Although the sealed bid process did not result in a sale, it did produce important market intelligence and heightened interest in all of the company's assets.
LiquiTec carried forward many of the sealed bid terms of sale to a public auction to ensure bidders of any of the major lots were prequalified. This strategy successfully produced competitive bidding for all of the assets, both in bulk and piecemeal, thus maximizing the sale proceeds. The sale results also affirmed that AccuVal's presale appraisals were an accurate indication of the value of the inventory and machinery.
Bottom Line: Asset Values Maximized; Appraisal Values Confirmed
LiquiTec quickly recognized that the sale of the intellectual property was the key to the overall successful sale of all of the company's assets. To generate these favorable results, LiquiTec deployed multiple sale strategies to force buyers to declare themselves and peak competitive interest. The auction results also affirmed presale appraisals of machinery and inventory, confirming that decision-makers had the accurate information needed to make strong business decisions.
The AccuVal AdVantage™
Accurate appraisals that reflect current market conditions. The ability to convert valuation opinions into sale results. Market intelligence and savvy sale strategies to ensure our clients achieve the best results. That's The AccuVal AdVantage™ at work.
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