A succession that protected both the business and the family that owned it

The owner was sixty-three years old. The next generation of the family was not in the business and did not intend to enter it. The senior management team was talented but had operated for two decades within a culture defined entirely by the owner's presence in the building. The business had received a series of unsolicited inbound expressions of interest, two from competitors and three from financial sponsors, and the owner had concluded — reluctantly — that the question of succession could no longer be deferred.

He retained Halverson Reed initially to advise him on the question of whether to engage with any of the inbound interest. The engagement broadened, over the following six months, into a comprehensive succession program addressing leadership, organization, ownership, and ultimately transaction.

The engagement was structured in three phases over two years. The first was strategic and personal: a frank assessment of the owner's options, of the business's current and prospective value under different paths, and of the leadership and organizational changes the business required regardless of which path was chosen. The conclusion — reached with the owner over several months — was that an eventual sale to a strategic acquirer was the right answer, and that the eighteen months before any process should be devoted to the leadership transition and operational improvements that would make the business meaningfully more attractive at sale.

The second phase was the leadership transition. The principal worked with the owner and the senior management team on the gradual transfer of authority, on the promotions and external hires required to backfill the owner's role, and on the cultural shifts required for the team to operate with full responsibility while the owner was still present. The owner stepped back from day-to-day operations twelve months before the sale process; he remained Chairman.

The third phase was the transaction. We worked alongside the owner's investment bank and legal counsel through the sale process, focused on the strategic and operational diligence and on the negotiation of the post-close arrangements that mattered to the owner — particularly the continuity of the senior team and the location of the headquarters.

The business sold to a strategic acquirer at a valuation 1.6× the indication of interest received at the start of the engagement. The senior management team was retained in full; the headquarters remained in place. The owner serves as Chairman of the combined business in a non-executive capacity and has spoken publicly, with rare candor for an owner in his position, about the cost of postponing the succession conversation.