A Mexican Company, founded in the early 1890’s, was owned and managed by members of the 3rd and 5th generations of the founder’s family. The Company was seeking a sale for estate planning purposes, and prior to Statesman’s involvement had two previous attempts at a sale fall through. For the Company’s majority shareholder, deciding to sell a generational family business was an emotional and hard decision.
Most of the Company’s sales were nominated in US$, though its internal financial reporting was in MX$. Other deal complexities included: a unionized workforce operating under a rolling 1-year Union agreement, a complex corporate structure comprised of multiple non-operating entities, and a portion of the land and buildings separately owned in a family trust that had to be rolled into the transaction.
Numerous international aspects were evident and had to be considered throughout the entire process. Several of these represented potentially serious implications to this specific transaction. The transaction was completed during the backdrop of (i) the peak of the highly publicized renegotiation of NAFTA between the US, Mexico and Canada, that is now replaced by a new trade agreement USMCA, (ii) the introduction of steep tariffs on steel imports into the US imposed by the U.S. Administration, and (iii) a major change in Mexican politics with the election and inauguration of a new president and new party coming into power in late 2018 which was widely perceived as an administration likely to be less business friendly.
Statesman’s Value Add:
- Exclusive sell-side M&A advisor
- Strategic positioning of the company for sale
- Comprehensive list of potential buyers prepared
- Marketing materials prepared in both English and Spanish
- Bi-lingual deal team members assisted in negotiations of price and terms
- Assistance with due diligence and closing documents
- Post transaction consultation and advice
Sale to a U.S. Public Company.
Statesman’s deal team had Spanish speaking members that allowed the complex deal terms and highly nuanced tax issues to be explained/discussed with shareholders in their native language. Statesman worked tirelessly to overcome all obstacles to get this transaction across the finish line.