In late 1995, I and my fellow shareholders thought it time to sell. My colleagues were in their 60s and I had exceeded my personal sell-by date several times over. In the 70s I had read Townsend’s book, ‘Up the Organisation’, an unusual but fine management tome, reflecting upon his experience as CEO at Avis. His rule was a Chief Executive should remain in post no more than three years. In 1995 I had been in post over five times that recommended span. Plus, every time I walked round a proverbial corner, I knew what to expect. I didn’t like that. Not the best, not for me. I like change. Would I continue to perform? Plus we were one of the oldest established MBOs in existence. We had certainly performed our ‘social’ duty, if there was such a thing.
In due course we took the decision to sell the business. At the time, the world economy was buoyant, the automotive sector likewise. Led by Ford, BIG (Tier One suppliers) was becoming good. I didn’t think that. But it meant medium sized companies would be keen to acquire smaller companies to become bigger. There could be a corporate acquisition feeding frenzy.
After ‘beauty parading’ six potential sellers of the business, we settled upon Price Waterhouse Coopers of Birmingham. The two young men had high energy and outlined an excellent process of placing potential bidders in an auction, whilst being unaware of the fact.
They whittled the number of potential interest down to less than six. One of the bidders was Adwest. They were known to me from Alford and Alder days (power steering rival) and owned a company which made handbrake cables. The Chief Executive had been telephoning me for some years inviting me to dinner for “strategic discussions” – code for ‘are you for sale’. My response was always “if and when we are for sale, you can join the queue.” Did this annoy him and we became a ‘must have? Anyway, the PWC process worked well and Adwest emerged as the highest bidder.
Due diligence followed. But off-site. Again, we had to keep such a prospect of selling the company, secret. It may all fall through. There was no point creating uncertainty. With employees or customers.
I was not to be part of the sale. I wouldn’t make a good employee, having enjoyed nearly two decades of almost complete freedom. I was likely to tell my new corporate boss where to go.
The Chief Executive and his entourage team arrived on site, just before due-diligence leading to completion. His opening remarks seemed hopeful. “I have been trying to cross this threshold for five years. I am here at last. If we knew what Rearsby knew; if we could do what Rearsby can do, I wouldn’t be buying Rearsby and I certainly wouldn’t be paying a premium, which I know I am.”