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Free Up Capital Using The Independant Stock Market For Secondary Market Investment
You have built up your company over the years as a private enterprise. It has a solid bank balance and a reliable profit margin that has enabled you to get to a stage where you wish to retire. Now you are looking for a buyer.
Well you know that pre tax profit over the last five years has amounted to $20mil, the assets in the factory in terms of machinery and instrument cost you $50 mil over the years, some is a bit antiquated but it all works, the you have other assets worth another $500,000 (Desks, computers, cars and the like)
You have a debtor's book of $3 million being mostly less than 90 days. A bank balance of $220,000. Staff who are hard working and honest. What is your business worth.
If you were to set it up today with new equipment it would require $60 mill, Ok depreciate the equipment and cars...so maybe $45 million, Profit say half of the 20mil. The Bank Balance is yours so that doesn't count, the debtor's book you could sell for its face value or maybe discount it slightly for the trouble of collection.
You would therefore expect to sell it for $45mill plus $10 mill plus $2.7mill = $57.7 ...
... mill. Sadly this is unlikely. Professional buyers of businesses won't buy at that rate. They will discount it even further than you think and will probably start at $35 mill and may top out around $40 mill. This is because you are kind of trapped unable to sell your stock easily. When you do sell you will probably have to bite that loss as well as pay a business broker a commission.
An Alternative is to sell it on the New York Stock Market. As you well know that is a very different ball game requiring no end of reports and filings and meetings. By the time you are listed you will have used up a million dollars in fees and costs and spent six months at least in interminable and boring and repetitive meetings.
But there is now an alternative in Secondary Market Investment via the Independent Stock Market. It puts you, the seller in contact with genuine investors who will enable them to realize a market value for the company that is actually approaching the market value. This may be done by a public company actually purchasing your company with shares in its own....(it issues more shares to cover the cost of the purchase) and this allows purchased company to become a stock traded on the NYSE.
Choosing this option will enable you to achieve a truer value for your company without having to sell off at a discount.
If you wish to realize some of the equity you have put in over the years the ISM may be the way to go. They have genuine investors looking for a safe reliable home for their cash and are quite willing to give you the assistance you need to get yourself a realistic value for your business.
Obtaining a true market value for your company is made possoble using the Secondary Market Investment.
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