You want to take over a company? Here are 6 typical profiles of sellers that you will surely face

Buyers-sellers relationships are one or the other: either crazy love or lousy relationships. Identify which category your vendor falls into.

SÉBASTIEN PIERROT, LAURA MAKARY PUBLISHED ON 05/10/2020 AT 9:55 AM

He burst into tears. “When I signed the sales agreement, my seller started to cry because I was becoming the boss of the company he had created years before. It was the business of his life,” says Augustin Davezac, who took over MCP, a small business in the construction sector, in 2013. In the transfer of a company, the emotional dimension is very present. “The seller is not only looking for a buyer. He is also looking for a successor, almost a son”, underlines Bernard Fraioli, the president of the association CRA (Cédants et repreneurs d’affaires). For some, these feelings do not affect the transaction or the transition that follows. “One year after the sale, the two sellers are still part of the strategic committee and continue to work for us as senior consultants,” says Nicolas Prévost, who bought the Collin Medical company from Paul Jaeckel and Michel Le Masson last year. On the other hand, there are those for whom affection is too important and leads them to “unbolt”.

First, then, those for whom the resale constitutes a brutal and traumatic break.

The box they are parting with is their baby. Once sold, they have nothing left. With them, there is no need to turn the knife in the wound. The duration of the support must be reduced to the strict minimum: just enough time to be introduced to the most important clients. “When I took over his design office, I saw that the former manager was upset. And as everything separated us concerning the management of the VSE, we agreed to make the shortest possible transition: he stayed two months”, relates Teddy Roger, a serial buyer from Normandy.

Then there are the sellers who sell their company when they don’t want to.

Pushed towards the exit by age or by their spouse, they slow down. Their objective: to obtain the highest possible price. “The seller mandated two executives to lead the negotiations and then wanted to take over by stopping the discussions. The aim was for us to come back to him with insistence. You should never underestimate the ego of the seller. Sometimes, it takes over the affect and only the amount at the bottom of the check counts”, regrets Guy de la Gravière, the boss of Opera Group (leader of the inventory of fixtures and real estate diagnostics). In the end, he bought the box in 2019 with a partner. But several months were lost and the negotiations almost failed. “There was no coaching. We spent zero days together. Forty-eight hours before the signing, he notified his employees of the sale and left.”

Third case: those who leave overnight to devote themselves 100% to their hobby or to their grandchildren.

They won’t give you any time, even though it’s spelled out in black and white in the memorandum of understanding. “The banks had insisted that the former CEO spend one day a week with me for three months to reassure the big clients and to introduce me to the intricacies of the business. In reality, he disappeared the day after the signing. I never saw him again”, testifies the buyer of an SME in Ile-de-France. With this type of profile, there is only one solution: identify the key person(s) of the company and rely on them to carry out the handover.

The fourth category of transferors is the ball and chain.

They have no equal when it comes to undermining the takeover. So when he bought a company in the events sector, Pierre was happy that the former owner kept a foot in the company. “This reassured the bankers and sent a positive signal to the employees and customers.” His joy was short-lived. “The seller wanted bonuses while he kept his boss’s salary, between 50,000 and 100,000 euros per year. Which is quite high considering he wasn’t doing much anymore. I ended up firing him. As a result, he took me to the industrial tribunal”. There followed two years of “exhausting” procedures which ended in a settlement. “I had to pay him a redundancy bonus and buy back the shares of the company he still owned. All for a six-figure sum.” His advice: get rid of this type of salesperson as soon as possible.

Another category to be wary of is the transferors who are supposed to give you a head start.

They know everything better than you and never agree on anything. Worse, they don’t hesitate to criticize you in front of the teams. “In meetings, we would make decisions that the ex-manager agreed with. But behind my back, he would go back to the participants one by one to dismantle the project. That kind of person who has a hard time letting go can be very damaging. We had planned for him to stay for six months. After one quarter, we shortened the transition and I asked him to leave,” says a scalded buyer.

Finally, there are those who withdraw leaving behind them time bombs. Often family members.

“The person I bought my business from had hired his sister and was paying her a grossly overvalued salary. When he left, her involvement decreased and she started to work less. As a result, she was costing me too much, so I decided to let her go. This required a lot of energy because I also had to separate myself from her son. As a result, I was less involved in business development and this slowed down our growth”, says a buyer from the construction sector.

To end on a positive note, let us specify that for some managers, on the contrary, the resale is a liberation. “They find a second wind because they no longer have to bear the responsibilities and the daily pressure”, concludes Teddy Roger. They prove to be valuable allies. “With confidence, you can hire them and keep them by your side for several years.” They will never bring tears to your eyes.

Article link: https://www.capital.fr/votre-carriere/vous-voulez-reprendre-une-entreprise-voici-6-profils-types-de-cedants-auxquels-vous-serez-surement-confrontes-1382237

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