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Exceeding the Investor’s Expectations
Representatives of the majority shareholder of a manufacturing plant approached BNC FINANCE with a relatively modest assignment. Holding approximately 70% of the company’s shares, they sought to acquire an additional 1–2% from minority shareholders.
At first, one member of our team was reluctant to participate in the meeting, believing that such a small transaction would generate limited value for the firm. Nevertheless, given the seriousness of the client and the fact that they represented a major financial and industrial holding, the meeting went ahead.
Following our discussions and a detailed analysis of the company’s shareholder structure, we identified an opportunity that went far beyond the client’s original objective. We advised the investor that there was a realistic possibility of acquiring the second-largest block of shares, which was owned by a government institution.
The client approved our strategy, and we immediately began implementing it.
Over the following months, we successfully acquired shares at favorable prices from minority shareholders, including both current and former employees of the plant, as well as from the government institution. Ultimately, we secured the maximum number of shares available from the remaining active shareholders.
As the project progressed, we also agreed on a success fee arrangement with the client, under which BNC FINANCE would receive an additional fee equal to 10% of the value of the shares acquired for each additional 1% ownership stake purchased.
The final outcome significantly exceeded the investor’s original expectations. What began as a relatively small acquisition evolved into a strategic expansion of the client’s ownership position.
The investor was highly satisfied with the results, while the success-based compensation generated by the transaction was sufficient to cover our firm’s office rent for an entire year.