Jim Cohen of Chicagoland Sunbelt Completes Sale of B2B Services Company
The transaction exemplifies the future of small business: Baby Boomers selling their businesses as they seek retirement and corporate refugees buying businesses to control their future.
- Chicago, IL (1888PressRelease) December 08, 2010 - Chicagoland Sunbelt announces today that Jim Cohen, Certified Business Intermediary and Lead Broker of Chicagoland Sunbelt, completed a transaction in the B2B commercial services industry. The transaction is an example of a growing trend Chicagoland Sunbelt is predicting as Baby Boomers sell their businesses in preparation for retirement and senior executives turn their back on corporate life and view a business acquisition as a way to control their future.
The seller was in his late 60's and had owned the business for over 20 years. The seller had no family members interested in taking over the business. "Selling the business would reward the seller for years of hard work building a cash flowing business as well as provide a significant payout to move into retirement. As Baby Boomers retire, we anticipate seeing many Baby Boomers doing the same," explained Cohen.
The profile of the business was extremely attractive to the marketplace: light in assets, recurring revenue, and a business-to-business customer base, with a cash flow sufficient to service the debt, invest in the growth of the company, and provide an income for the buyer. At the time of the sale, revenues were approximately $2.5 million and cash flow was over $450,000. The business is a leader in industrial cleaning and operates in 3 states in the Midwest. Market presence is strong. Over 25 per cent of new business is through referral.
The marketplace responded quickly and forcefully. There were over 40 inquiries, 18 showings, and 3 offers. Cohen provided guidance to the seller on the relative merits of each of the offers in terms of the relative risk of the deal structure and the buyers' strengths and weaknesses.
The terms of sale were a down payment of over 50%, with the seller financing the remainder as a loan, and an earnout dependant on the future performance of the business. "Seller financing is a key to a successful business sale," Cohen noted.
"Chicagoland Sunbelt has not seen the banks participating in the market since late 2008," Domenic Rinaldi, President and Managing Partner of Chicagoland Sunbelt explained further. "However, our company, and Jim in particular, has been very successful with structuring deals with seller financing. As a Certified Business Intermediary, he has the skills and experience to help sellers structure a deal that protects them from potential downsides while being mindful of tax consequences."
The buyer had a background in marketing, strategy, and finance and had consistently worked at Fortune 500 companies or marquee consulting firms. "After reaching the SVP level at a Fortune 500 consumer products company and being downsized he believed that buying a business would put his future in his hands and not someone else's," Cohen said. "He had looked at multiple opportunities and made offers on other businesses but once he saw this opportunity he was committed to getting the deal done."
The seller had come on to the market concerned about confidentiality. His business was a niche service with few competitors. Due to his long history in the business he felt that he was very well known. Chicagoland Sunbelt's proprietary process kept the transaction confidential. The total time from the listing date to closing was less than four months.
About Jim Cohen
Jim is a Certified Business Intermediary and the Lead Broker for Chicagoland Sunbelt. Having spent more than twenty years as an owner of multimillion-dollar domestic and international manufacturing businesses, Jim brings a wealth of experience in buying, operating and selling closely held companies. He has firsthand knowledge of the needs and concerns of individuals selling their businesses.
Jim represents owners in the confidential sale of businesses ranging from one to twenty million dollars in revenue. Jim has represented clients in sectors including automotive, construction, education, financial, food service, health care, industrial maintenance, medical supplies and technology. These sectors span business-to-business, direct to consumer, distribution, manufacturing, retail, and wholesale channels.
Jim is a proud member of the International Business Brokers Association and holds the Certified Business IntermediaryŽ (CBIŽ) designation. This designation sets the industry standard within the intermediary community, and provides assurance of professionalism to clients and other key advisors.
See Jim's complete bio at: www.chicagolandsunbelt.com/team-Cohen.htm
About Chicagoland Sunbelt
Chicagoland Sunbelt is a business brokerage firm that focuses on helping people sell, buy and grow businesses in Chicagoland and the surrounding Midwest. Having sold hundreds of businesses, Chicagoland Sunbelt understands a broad range of industries, including business services, distribution, food & beverage, franchises, personal services and retail. Its experienced team of M&A brokerage consultants also develops and executes comprehensive strategies designed to meet individual financial and non-financial goals.
Chicagoland Sunbelt is also a proud member of Sunbelt Midwest, which operates offices in Minnesota, Wisconsin & Illinois, For your next business purchase or sale, visit Chicagoland Sunbelt at www.chicagolandsunbelt.com.
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