A Transition During an Economic Crisis
October 22, 2019 | Business Transitions Forum
With only a couple of weeks away from BTF Calgary, we continue to spotlight the profiles of amazing business owners who will be sharing their experiences on stage.
This time we spoke with Bill Darling, former President of Big Guns Energy Services.
Bill is a native Calgarian and has worked in the oil patch for 41 years.
He has started, grown and sold three successful service companies in this industry.
As acting president, he managed up to 120 employees, in three cities in Alberta and Saskatchewan. Through the years and his experiences, Bill learned a great deal about growing, buying and selling small companies.
He is keenly aware of the struggles and the “hell” of working with banks and lawyers, as well as the euphoria of working hard, and building and selling a successful business.
BTF: Tell us about your latest transition?
Bill: We sold a division of our company to a competitor in 2013. Half of the proceeds were paid upfront and half were to be paid out over the following 3 years. The equipment was transferred to their name.
BTF: What single factor made your company attractive to acquirer(s)?
Bill: We had a patent on our equipment and no one else could operate or build the kind of equipment we sold.
BTF: What was the hardest part of selling your business?
Bill: The hardest part was selling but not getting paid all monies at the time of sale. We agreed to this clause because times were very good in 2013.
BTF: What are a few specific things that you or your advisory team did to increase the proceeds/improve the outcome of the transaction?
Bill: We had the equipment evaluated and it fell short of our purchase price by 2.5 million. So we assessed the patents at that value which was very fortunate.
BTF: What element of the process of selling did you find most surprising/unexpected?
Bill: The biggest surprise was the downturn in the oilpatch which made the purchasers unable to finish paying us for the equipment. This coupled with the fact that the equipment was in their name even though it wasn’t fully paid for was an unfortunate thing that we never saw coming. The equipment was very lucrative but during the bankruptcy, it was so run down it sold for pennies on the dollar.
Hear Bill and other business owners as they share their exit stories at one of our most popular panels “The good, the bad and the ugly” at BTF Calgary on October 30 & 31. Limited seats available, so register today!