What happens when external circumstances dictate a fast, efficient sale of your company? While each seller’s requirements will differ, the key to meeting them is first understanding the context, needs and motivations. Second to this is executing an efficient and tailored process.
The sale of sustainable Danish paper supplier Skjern Paper is a great example. They had previously engaged financial advisors when looking to sell. Yet, cultural barriers and differences during the evaluation process held them back.
This changed in April 2021 when our advisors checked in. Skjern’s business was booming and as is most often the case when the decision is made, a swift sale of the asset is key.
So, how did we take a different approach that successfully got the transaction over the line?
Framing the asset correctly, a client relationship built on trust and a tailored approach led to the deal being agreed in half the time it would usually take.
Meeting the seller’s needs
A pragmatic approach allowed us to find the right buyer, fast. Yet, another key factor allowed the sale to be completed in a five-month time frame – trust.
Unsurprisingly, Skjern Paper was located near the city of Skjern. The owners lived nearby. They had a reputation to consider and wanted to ensure their employees would be looked after.
Thanks to a long-standing relationship with the client, we secured go-ahead to execute on their behalf. Our advisors took their specific needs into account when finding the buyer. And, as a result of the trust, the Danish summer break roadblock was avoided.
Usually, it would take 2 months to prepare the materials needed to go to market. In an unusual approach, as we knew the business well, we went to market while simultaneously building the case.
We also aligned with Skjern’s culture. Rather than the rigorous standard request list, we strategically gathered the evidence that mattered most. You wouldn’t find your typical 150 slide deck there.
This approach isn’t correct for every deal. But it was correct for Skjern and Sonoco. Sale was agreed in September 2021.
Framing the deal
Once a mandate to sell is secured – especially one that dictates speed – it’s our job to show prospective buyers in the market that the timing is right.
Let’s start with the eventual buyer: Sonoco Products Company (Sonoco), a global packaging group looking to invest in sustainable paper and packaging products in Europe. They also wanted to reduce C02 emissions.
Skjern were, by a long distance, the most sustainable paper mill in Europe. They turned wastepaper into new paper as a raw material to be used as packaging. The company ran on wood chips rather than gas and harvested excess heating from their production process, which was used for supplying district heating to the local community.
We matched Skjern and strategic buyer Sonoco firstly on sustainability grounds. Tick.
At the same time, the Russia-Ukraine war threw Europe’s energy security into question. Sonoco were wary of overreliance on imported Russian gas and acutely aware that paper mills would probably not be classed as essential businesses if gas limitations came into play.
Timing and framing are everything. Skjern represented a green business that could reliably supply itself with a sustainable energy resource. Our advisors had built a clear case for Sonoco.
The Clearwater difference
