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  • Digg it UP - Selling Your Business - What Would Sam Zell Do?

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    nother related business, and begin the process. If they get an offer, it is low and is driven down during the due diligence process because there is nothing to stop thi
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    If you were thinking of making an investment it might be a good idea to watch how Warren Buffet does it. If you are going to sell your business, maybe you should emulate Sam Zell, multibillionaire founder of Equity Residential (EQR). He is selling his company in one of the largest private equity deals ever.

    Sam agreed to take an initial offer from Blackrock Private Equity at $48 per share with a break-up fee of $500 million. EQR has 292.13 million shares outstanding, resulting in a total bid of $14.02 billion. This is where most privately held business owners stop. They put the word out through their professional network, get an introduction to an owner of another related business, and begin the process. If they get an offer, it is low and is driven down during the due diligence process because there is nothing to stop this

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    e Sam Zell, multibillionaire founder of Equity Residential (EQR). He is selling his company in one of the largest private equity deals ever.

    Sam agreed to take an initial offer from Blackrock Private Equity at $48 per share with a break-up fee of $500 million. EQR has 292.13 million shares outstanding, resulting in a total bid of $14.02 billion. This is where most privately held business owners stop. They put the word out through their professional network, get an introduction to an owner of another related business, and begin the process. If they get an offer, it is low and is driven down during the due diligence process because there is nothing to stop thi

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    initial offer from Blackrock Private Equity at $48 per share with a break-up fee of $500 million. EQR has 292.13 million shares outstanding, resulting in a total bid of $14.02 billion. This is where most privately held business owners stop. They put the word out through their professional network, get an introduction to an owner of another related business, and begin the process. If they get an offer, it is low and is driven down during the due diligence process because there is nothing to stop thi
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    f $14.02 billion. This is where most privately held business owners stop. They put the word out through their professional network, get an introduction to an owner of another related business, and begin the process. If they get an offer, it is low and is driven down during the due diligence process because there is nothing to stop thi
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    nother related business, and begin the process. If they get an offer, it is low and is driven down during the due diligence process because there is nothing to stop this behavior from a single buyer.

    Back to Sam Zell. Sam tells his investment bankers to continue to solicit more buyers. Surprise, enter Vornado with the backing of a couple of very large private equity competitors of Blackrock. Their first counter offer is $52 per share. It goes back and forth with these heavyweights slugging it out. When I last checked, Blackrock had increased their bid to $56.35 per share, making the total bid $16.46 billion. That is an increase of $2.44 billion over the initial bid.

    We tell our clients that a competitive bid will produce a 20% premium or more over a single bid. In the case of a single non-solicited bid, the difference

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