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Not as Bad as Stuffing a Live Octopus Into a Mesh Shopping Bag, But....

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Not as Bad as Stuffing a Live Octopus Into a Mesh Shopping Bag, But....

  1. 1. Distressed Asset M&A Not as Bad as Stuffing a Live Octopus into a Mesh Shopping Bag, But…
  2. 2. 2 Distressed Asset Spectrum Bankrupt Winding Down Restructuring Biz Unit Close Non-Dilutive Cash Injection • IP owner wants to sell fast • More deal flexibility Seller Characteristics • Supporting information varies • IP “Care & Feeding” riskIP Characteristics Slide 2 Increasing Support Information
  3. 3. 3 What to Expect? • Bankruptcy – multiple beneficiaries • Business unit sale – strategic partner fit Multiparty interests • No time for diligence = IP with no value Speed kills value • No integration – no HR issues • Limited post close cash injections Some problems go away (or at least different) Slide 3
  4. 4. 4 More Efficient Transactions • What is the value Agreement on the “why” of the purchase • Build internal consensus • Aid in external negotiations Valuation modeling • “Better, stronger, faster” Leverage in-house specialists • Cap your diligence costs Fixed priced diligence Slide 4

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