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The Prince and the Predator
(The Acquisition Team)
by Stuart Daw
(originally published in Canadian Vending, June 1998)
You had no idea of selling the business, but
a company from Bigtown had put out feelers. You were curious, wondering what
your business was really worth, so you took a phone call from a recruiter
representing the buyer. You find out who it really is. You’re impressed, but
you’re a bit scared, too. You half expected that company (let’s call it
Canadian Coffee Company, CCC for short) would some day arrive in your town. But
now you realize they are going to do it by acquisition instead of just starting
out cold.
The CCC president (let’s call him PRINCE)
flies in personally to see you. You’re flattered, but you have a healthy ego
and think you might even dazzle him with your superior grasp of the coffee
service business. You meet at his hotel for security. Your staff mustn’t hear
about it.
PRINCE turns out to be a really nice guy. He’s
urbane, soft spoken, and seems like a genuine, caring individual. He’s
especially solicitous about you and your family’s well-being; about your kids
and their future. He’s careful not to put down any of your accomplishments in
the business. In fact you are pleased that he doesn’t even react to a couple
of derogatory comments you made about his company’s reputation.
He creates such a subtle, but attractive
picture of a combined coffee service in your city, with you in command of
course, that you become quite excited. He says you’ll likely even travel on
behalf of the company. He smoothly mentions that there might be a few obstacles
to finalizing a deal, but with your permission he would certainly like to make
an offer.
You promise to send some statements to him.
You part with a warm handshake. You have trouble explaining the emotion you feel
as you head for your car in the parking lot, for you have that strange, almost
giddy desire, not to walk but to run, maybe even clicking your heels as you go.
You haven’t felt that way in a long time.
You tell your wife about the meeting, and
especially about PRINCE. Wow! What a great guy! "I had no idea a real
tycoon like that could be so human, so caring, so warm!" Your wife is sold
on it. "Do it," she commands.
Good news! He’s seen your financials and he’s
on the telephone asking you what you want for the business. With some
trepidation you decide to go for the brass ring; you say you want 20 times one
month’s gross profit. You nearly fall out of your chair, for he tells you it
seems reasonable.
Working through your attorney, and after weeks
of negotiating punctuated by soothing phone calls from PRINCE, a long contract
of purchase and sale has been drafted. Your wife has overdrawn your bank account
in anticipation of the Close. After all she has been denied for so long, and
besides you are enjoying the new set of golf clubs you put on your credit card
so you’ll look okay at the local club you decided to join. You’re committed.
There’s no looking back.
The big come-and-get-it-day arrives. You’re
at the lawyer’s at 8:30 a.m. where your man and a local lawyer CCC has
retained are waiting. It turns out they are waiting also for CCC’s controller
(let’s call him PREDATOR) to arrive from Bigtown. PRINCE is not coming to the
closing. You’re disappointed, but are told he had to attend his nephew’s
wedding somewhere.
PREDATOR arrives. Turns out besides being a
CPA, he has a law degree and an MBA as well. He doesn’t smile when he shakes
hands. He looks out the window and remarks that he has never been in this town
before, with the air of someone who doesn’t want to ever see it again. He
seems cold, not at all like PRINCE. He is presented a copy of the contract of
purchase and sale. He glances at the first page as if he’s never seen it
before, then flips it onto the floor. "This is entirely
unsatisfactory," he casually asserts. Your lawyer and you are both
dumbfounded! How can this be, after all the delicate negotiating that has taken
weeks to conclude? Who is this PREDATOR?
PREDATOR teaches you something new, which he
calls The Nail In The Floor Theory. "This contract names all the assets CCC
would buy. That’s no good. We’re not telling you what we’re buying,"
PREDATOR says. "We're buying everything! You tell us what we are not
buying. If you want to keep that nail in the floor (pointing downward), then you
tell us so in the contract. The whole agreement has to be redone accordingly.
And furthermore, the price is ridiculously high. I don’t know how you talked
PRINCE into this deal." He implies he’ll walk away if you don’t agree
to an adjustment.
Your impulse is to call the whole thing off.
But what about the new mink coat and your new golf clubs? The rumor of a sale is
all over town. Your mind had been made up and the net proceeds have been half
spent. In a state of shock, you demand that you be allowed to call PRINCE. But
PRINCE can’t be reached and you are assured PRINCE has given PREDATOR full
authority to close the deal. But you wonder why PREDATOR keeps going into
another room to make phone calls.
Suddenly you realize you’ve been slightly
had. In time you learn to know it as the PRINCE and the PREDATOR routine (PP for
short). PREDATOR seems to have a psychological problem. If a deal closes, it was
not good enough for him, on principle. You have to be lying unconscious on the
floor with him guiding your hand over the signing page before he’s satisfied.
So the deal gets renegotiated down to a lower price right on the spot and by
midnight he has a signed contract.
You’re exhausted and devastated, but that
next evening your wife receives a beautiful bouquet of flowers wired from
Bigtown. The phone rings, and PRINCE soothingly assures you when you complain
bitterly about PREDATOR’S behavior that it’s just PREDATOR’S way, and that
you will grow to like PREDATOR.
In fact, you do survive the sale. You do okay
under the new arrangement. You seek out acquisitions for the new combined
company, and find yourself having to play PRINCE to PREDATOR’s PREDATOR on the
acquisition team. Very unpleasant. But much later, when you’re a bit older and
free of that organization, any of the myriad deals you are involved in seem like
a breeze by comparison, filled with goodwill. In all, just another good lesson
in business life.
© 1998 Stuart Daw | 
