Page 10 - Grapevine JanFeb 2022
P. 10

In The Winery



                                                                    value. That means there is a willing seller and a
                                                                    willing buyer. However, the price could be much
                                                                    lower in a scenario where the owner is forced to
                                                                    sell or liquidate, either through bankruptcy, the
                                                                    sudden death of key people, or litigation. In these
                                                                    situations, engaging an experienced restructuring
                                                                    professional is essential.  Navigating a distressed
                                                                    situation is difficult, doubly so when the business is
                                                                    yours.

                                                                      There are multiple variables for owners to con-
                                                                    sider and plan for as they create their harvest
                                                                    strategy. Being prepared for this transition will help
                                                                    them avoid costly mistakes or address issues early
                                                                    enough in the process to make them non-factors.
                                                                    This planning is essential to maximizing the value of
                                                                    their business. Owners contemplating making this
                                                                    transition would be wise to start the process and
                                                                    create their harvest strategy today.

                                                                                      Edward Webb has over 35 years
                                                                                      of experience in consulting and
                                                                                      financial management, including
                                                                                      specific experience in business
                                                                                      restructuring and leadership
               option. The sale could be to an industry peer, a cur-                  advisory services. Edward has a
               rent employee, a high-net-worth individual or even   Doctorate in Business Administration and currently
               a private equity fund. However, certain factors go   leads the Corporate Finance Consulting group at
               into the sale and the final price beyond the valua-  BPM, one of the 50 largest public accounting and
               tion process discussed earlier.                      advisory firms in the country, where he sits on the
                                                                    firm’s Management Committee.
                 Any potential buyer is looking for the ability to
               generate future cash flow. Operating a winery takes                    With more than 15 years of
               leadership with specialized education and experi-                      experience in complex financial
               ence. This knowledge includes how to grow and                          advisory, and a primary focus on
               harvest grapes, the manufacturing process, as well                     valuation services, Kemp Moyer
               as storage of the wine. If the sale is to anyone but                   has led hundreds of business and
               an industry peer or employee, this can hobble a                        asset valuations in his career with
               deal or result in a lower sales price. As mentioned   substantial industry experience in technology, life
               earlier, having a detailed manual on how to oper-    science, professional services, food and beverage,
               ate the business can help reduce transition issues   digital assets, manufacturing, and consumer busi-
               that may impact price, but locking down an expert    ness, among others. A partner in BPM’s Advisory
               to assist with a sale can be essential to getting the   practice and head of the firm’s Valuation team,
               maximum return in a sale.                            Kemp’s valuation experience includes M&A and
                                                                    IPO preparation and support, fairness and solvency

                           Distressed Resolutions                   opinions, and litigation support and dispute resolu-
                                                                    tion, among other high impact analyses.
                 All the information above is based on the order-
               ly sale or transfer of the business at a fair market

               Page 8                          The Grapevine • January - February 2022                             877-892-5332





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