Renewable Energy Integration Group

Situation

The business owners, Keith and Susan, wisely planned well in advance to prepare for selling the business he had founded, REIG. Keith retained a consultant, who had owned and sold a business recently, to help him and his leadership team focus on areas of the business that would drive value. This initiative to improve the business and drive value was planned and sequenced over multiple years and included his wife who was the firm’s Controller and the COO, Brian.

As is often the case in life the consultant, Rene, knew Adam Petricoff, Managing Partner of VR Business Sales Charlotte, and introduced him to Keith. Adam had met with the REIG team to discuss timelines and goals well in advance of meeting last summer when the focus was on confirming the timeframe to sell the business so Keith and Susan could retire and spend more time with their grandchildren.

Throughout the exit planning process, Keith desired to sell the company internally, transferring ownership to a key employee, Brian Otto, the current COO, the seller’s choice.

The Nuances of an Internal Sale and the Role of the Business Broker

Adam Petricoff has brokered many transactions throughout his career, including internal sales. Some steps in his team’s proven business brokerage process do not apply in an internal sale as the business is not formally taken to market so a confidential business review is not developed. An internal sale is often nuanced and commonly more delicate than a traditional sale of a business.

Experience and expertise were paramount to successfully champion this internal sale from the owners to the COO; unlike traditional business brokerage transactions, there are long-term relationships at stake. A misstep can damage relationships and adversely affect the salability of the business putting the seller at a real disadvantage to sell the business.

Petricoff collaborated with both parties, sellers and the buyer, every step of the way to explain each step in the process as this was a new experience for both the sellers and buyers. Petricoff worked closely with the firm’s accountant and the firm’s general counsel, who both parties agreed to work with to facilitate the transaction from start to finish.

Petricoff played an integral part in negotiating financing terms including seller financing, introducing the buyer to an SBA lender and coordinating the lender’s requirements for customer contracts to be assigned approving the transaction.

“Utilizing the services of VR Brokers was one of the best decisions we made regarding the sale of our business. Adam and Lauren were on top of all the details, kept everyone pointed in the right direction and were supportive during the entire process. They were focused and gentle during the entire year-long process and we cannot thank them enough for their skills, leadership, and encouragement through the entire process. They knew what was needed when and kept us the sellers, the buyer, the attorneys, and bankers all on task and on time to the very end. Thank you both for everything.”

Keith and Susan Davis, President and Controller, Sellers
Renewable Energy Integration Group, LLC

The Result

While the initial goal was to complete the sales of the business to Brian Otto by year-end, the transaction closed in Q1 for tax savings purposes and also due to the reality of the current President, Controller and COO being extremely busy managing and running the business.

As transition terms were being finalized, Petricoff advised the seller to shorten the time period he would commit to staying involved. The seller was initially hesitant but at the conclusion of his shorter transition time period, he acknowledged this was excellent advice.

The sellers are happy to be enjoying retirement with their grandchildren and the business is in highly capable hands with a seasoned employee taking on the role of CEO, in a business well positioned for growth.

“I wholeheartedly recommend VR Business Sales to anyone looking to buy a business. Their expertise, professionalism, and unwavering support were instrumental in my successful acquisition, and I am grateful for their partnership. Thank you, VR Business Sales for making this experience not only successful but also enjoyable!”

Brian Otto, CEO, Buyer
Renewable Energy Integration Group, LLC