Situation
Owners of two, Day Schools/Day Care Centers (infants through Kindergarten) wanted to exit their business post Covid-19. The owners had recently relocated to another state and were struggling to manage day-to-day business activities (primarily addressing staffing issues) remotely. Additionally, the business had been severely impacted by the Covid-19 pandemic, and was rebounding, but was still not back to pre-pandemic levels. They were not sure if they still had something of value to sell.
Findings
Upon touring facilities and meeting with owners, we determined business was extremely viable, was beginning to rebound nicely post Covid-19, and had desirable locations for a potential strategic buyer.
Actions
Turning Point created a valuation of the Companies utilizing market techniques and competitive market review to determine such values. This included a range in value that would be appropriate in consummating a sale of the Companies and included appropriate valuation projections and adjusted EBITDA.
- We prepared an information memorandum describing the Companies, their historical performance and prospects, including existing contracts, facilities, marketing, sales, labor force, management and anticipated financial results of the Companies.
- We developed a list of suitable potential buyers who were contacted on a discreet and confidential basis.
- We coordinated the execution of confidentiality agreements with potential buyers wishing to review the information memorandum.
- We coordinated site visits for interested buyers and prepared appropriate presentations for such visits.
- We solicited competitive offers from potential buyers.
- We advised and assisted the owners in structuring the transaction and negotiating the transaction agreements.
Outcome
Turning Point was able to consummate a sale of the companies to the largest strategic buyer in the industry at a 30-plus percent premium to two other market offers. The sale was a significant win for the owners and the employees were all retained by the buyer.
