Objective: to support and advise our client in urgent divestments, pre-deal, and deal execution for a modern furniture factory, selling to major European distributor and retailer with a production capacity of $US 20 million.
Project Background & Context:
A large US investment fund needed to take an urgent and strategic decision regarding one of its industrial assets in Vietnam. This asset consists of a modern furniture factory, selling to a major European distributor and retailer with a production capacity of $US 20 million.
Source of Asia (SOA) was first engaged to assist the client in making the most strategic decision for their business: whether to sell or close the production facility. SOA acted as the official local representative of the client in Vietnam throughout the process.
Then, we were granted the exclusive mandate for the future sale as the client decided to proceed with the M&A process and put factory in Vietnam up for sale. The chosen solution had to be implemented in a short period of time.
Advising our client on how best to exit their business
The primary objectives of the mission were to:
- Determine whether to sell or close the furniture factory in Vietnam.
- Provide a comprehensive evaluation of the factory, including value estimation and legal, administrative, and organizational considerations for both options.
- In a short period of time, offer strategic recommendations aligned with the current situation of the factory.
Source of Asia’s divestiture process included the following steps:
- Factory visits for an in-depth audit of the Vietnamese facility and value estimation based on factual observation and analysis of documents provided by the client and stakeholders.
- Comparative analysis of advantages and disadvantages, along with a detailed report outlining the process (legal, administrative, organizational) of closing or selling a factory in Vietnam for each option.
- Strategic recommendations tailored to the factory’s current situation.
3 main results were identified:
- Presentation of a comprehensive 30-page mission report. This report included a detailed situation analysis, a comparison of the two options (closure or sale),
- Strategic recommendations and a summarized factory audit and asset valuation.
- Introduction to the general merger and acquisition process.
Based on the final report, the client decided to proceed with the M&A process and put factory in Vietnam up for sale. Source of Asia was granted the exclusive mandate for future sales.
2. Sell-Side: Accompany our client on pre-deal and deal execution M&A process
The secondary objectives of the mission were to:
- Attract potential buyers.
- Engage suitable buyers, including investment funds, ASEAN manufacturers, and wholesalers.
- Facilitate meetings and guide the seller through the due diligence process.
- Support the seller in negotiating and finalizing agreements for a favorable outcome.
- Ensure seamless transaction execution and successful deal closure, maximizing the sale value.
- Develop teasers and summaries to generate buyer interest.
- Conduct targeted outreach to potential buyers.
- Coordinate meetings and guide the due diligence process.
- Prepare a comprehensive VDD report based on factory audit findings and financial data.
- Provide expert support during negotiation stages.
The deal was successfully executed, resulting in a 100% operational transaction. In the context of urgent divestments, Source of Asia managed to support its client in 9 months from the mission kick off to the deal signature.