Getting a Deal Done With Some Creative Structures

Be careful of being toooo creative! If the deal seems odd, unusual and complicated, maybe the parties need to take a step back and reflect on the transaction. Creativity may be necessary, but we should be cautious. We are open to new ideas if both sides figure out a way to win, but winning is the key word.

I’m not going to get specific on how the deal was done for fear of copycatters, but a recent transaction became very creative on the day of closing.

The buyer and seller discussed changing the terms and delaying the ownership transfer for several months, yet still “closed” on the deal. Against our advice and their attorney’s advice, they proceeded to closing. They both seem to be happy and ready to plow into business together.

Frankly, we are nervous. As long as both sides hold true to their intentions it should work, but what will happen if there is a rough patch in the relationship a couple months down the road? Will they work through it together, or use it as an excuse to get out of the deal?

We’ll keep tabs on the deal, because we are certainly hopeful for the success of the business. If they are successful, it may give us a new way to do deals! There are so many ways to skin the cat that we have many options to help you complete a sale. Talk to your Apex Business Advisor for assistance.

Doug Hubler
President