Saving Private Ryan Companies
Last month I had a very lucrative, but sad day.
I spent nearly four decades in the same private employee-held service sector company, the final eleven years as its CEO. Over my career, I witnessed it achieve world-class status in its focused sector of global water infrastructure. Three years ago, I left the management for an independent consulting practice but, as did other senior retirees with large holdings, retained a stock position in a multi-year sell-down allowing the company continued use of my investment capital.
Since I left the management team, the firm repeatedly told its employees of its exciting future as evidenced by its ever-growing record backlog, strategically enhancing acquisitions and improving internal efficiency. They credited much of the success to the dedication and care of employees who were also the sole owners.
But last fall, the Board quietly self-initiated a structured sales process with about a dozen self-chosen firms and sold this spring to a public company—to the surprise of its shareholders, employees and the industry. When the deal closed I benefited through my residual stock’s escalation, but it was a depressing day for me. Another mid-sized, privately held, services company was gone…this time; it was the firm to which I had dedicated my career.
As a result of the acquisition, many of the latent ambitions of both individuals and the company’s leadership, that was not possible before the sale, may now be achieved with the new configuration. The buyer is an established public company in the infrastructure space with proven leadership and better accessibility to growth capital. All this may be true, but sadly, the merger results in the rapid evaporation of my former company’s enterprise legacy and independence. And that change is irreversible. There is […]