EQUITY PLACEMENTS

Monday, December 09, 2019

This is a very sophisticated approach which typically yields multiple equity offers to be valued not only in terms of the equity for cash ratio, but also for the intangible contributions made by the equity partner (investment group or strategic partner/synergistic company). These intangible contributions can far outweigh the capital contribution, and can include; management expertise, relationships, distribution channels, reduced overhead, intellectual property, transfer of knowledge, additional sources of capital at a lower cost, etc.

We can advise our client in all these matters. Following is an outline showing the services offered.

Phase I – Preparation 
  • Obtain Company financials and other information and commence work on valuation of company, if required.
  • Complete and deliver company valuation (where required).
    Develop, with Company assistance, a financial model (including pro-formas, recast earnings, projections, etc.) to be used with prospective investors.
  • Prepare a blind profile describing Company to prospective investors. 
  • Obtain client approval of blind profile.
  • Prepare a confidential memorandum(s) describing the Company to be shown to prospective investors.
  • Obtain client approval of memorandum(s).
  • Identify and prioritize, in consultation with the Company, specifically named potential investors.
  • Identify, by industry and region, numerous general potential investors (by SIC codes) for the Company.
Phase II- Marketing 
  • Initiate implementation of marketing campaign by contacting Buyout Groups (Private Equity Groups and Private Investment Groups) regarding the Company offering.
  • Obtain signed non-disclosure/confidentiality agreements from prospective investors and provide confidential memorandum on Company.
  • Commence solicitation of specifically named potential investors for the Company.
  • Obtain signed non-disclosure/confidentiality agreements from prospective investors and provide confidential memorandum on Company.
  • Research and obtain contact information of general potential investors for the Company.
  • Commence solicitation of general potential investors for the Company.
    Obtain signed non-disclosure/confidentiality agreements from general prospective investors.
  • Provide interested general prospective investors with a qualifying investor profile.
  • Review qualifying investor profiles from general prospective investors.
    Provide confidential memorandum on Company to qualified general prospective investors.
Phase III- Negotiation
  • Solicit, as appropriate, preliminary indications of terms from potential investors and assist the Company in determining which potential investors should continue as part of the sale process.
  • Assist appropriate suitors in preparing letter of intent or offer to purchase equity.
  • Assist the Company in negotiating letters of intent with the prospects having the best combination of price, terms, and ability/motivation to close.
  • If the proposed transaction is a stock purchase assist both parties in bridging the contingent liability gap through representation and warranty insurance solutions.
  • Finalize and obtain signatures on offer to purchase.
Phase IV- Final Documentation and Closing
  • Assist the Company in communications with the “best” prospect in the final due diligence process.
  • Assist the Company and its legal counsel to negotiate final terms of purchase agreement and affect a closing.
  • If appropriate, close third party stock sale of Company’s stock to eliminate corporate tax prior to dispersing Company’s proceeds of sale to owners.

Silverbear Capital, Inc.

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