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company up for “broad auction” which lets the cat out of the bag terms of the privacy of the seller. What Carter does is set up a “controlled auction.” “You may be approaching five to fifteen buyers, pre-identified, prescreened,” he said. “They all have a very specific reason why they’d want to buy your company.” After identifying potential buyers domestically and internationally, a firm then undertakes a crucial and creative part of the acquisition process: marketing. Mark Gregoretti called it writing “the story of the business.” “Buyers come in and they are pretty savvy,” he said. “They are willing to spend the money, but they want to know the story, the potential.” Carter said that developing a narrative around the company is essential to maximize excitement about the company. “The objective is to generate a lot of understanding and appreciation for the company’s value,” he said. On the reverse, marketing a buyer increases
the likelihood of a deal being closed. An agency perhaps offers the most for both sides in the negotiating process. There are often terms and conditions to consider when drafting an agreement and many deal-specific minutiae are
“Buyers come in and they are pretty savvy,” he said. “They are willing to spend the money, but they want to know the story, the potential.” — Mark Gregoretti
gone over with the specificity of a legal document. Even after a deal is agreed upon, there are a lot of details to be worked out for both sides. “It’s very rare someone says, ‘Here’s $10 million, goodbye and good luck,” Carter said.
The final due diligence period arrives and it’s time to sign on the dotted line. “Something always comes up at the last moment,” Carter said. When he linked up Reliable with a buyer, for example, it was in 2008, just as the recession was taking hold. Carter was able to keep it together, according to Gregoretti, and ensured a strong final price (which was not disclosed). Gregoretti felt the price was a fair one for both sides, particularly given the economy at the time, December 2008, shortly after the collapse of Bear Stearns and Lehman Brothers. “When you get a big offer, you have to take it because it may never come again,” he said. In the end, Eastford-based Whitcraft L.L.C. acquired Reliable. Investors included Golub Capital and Ironwood Capital who provided $25 million of mezzanine funding. Gregoretti recently reached out to Carter and his group again, this time as a buyer seeking a company that fits his needs. “Selling a business gives you a perspective in this process,” he said.T:“You 7 in don’t want to buy the wrong company.”
Colt merges civilian, military entities Leading gun manufacturer Colt has reunited its defense and civilian-oriented arms after the two had operated as separate entities since 2003. Colt Defense L.L.C., which makes rifles and carbines for the military, law enforcement and sporting markets, acquired New Colt Holding Corp., the parent company of Colt’s Manufacturing Co. L.L.C., which primarily serves the civilian market. The merger was announced July 15. Despite having separate operations, both companies have been headquartered at the same space on New Park Avenue in West Hartford. The combined firm will reportedly employ 750 people, with the merger valued at $60.5 million. Colt Defense CEO Gerry Dinkel said the merger reflects the growing demand for civilian firearms, according to published reports. He said the decision was not impacted by the gun reforms enacted by the state earlier this spring. — Jennifer Bissell
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12 Week of July 29, 2013 • Fairfield County Business Journal
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