The bank had lost confidence in a management team. The company had £40m of debt and capital assets that were reducing in value.
The bank gave the sole shareholder of the company a clear choice: sell the company or replace the management team (and if in the latter case it was clear that the bank would give the shareholder 6 months to turn the situation around or appoint administrators).
The company had a sale price of just under £100m.
The company was sold.
In circumstances like this the client and the advisor have to act fast and be decisive. If the buyer realises that the seller has no cards to play then the buyer is definitely going to win the game, and yet if your back is against the wall – you need the deal to go through.
How to negotiate in a difficult situation
The solution is to understand your negotiating position, concede what you need to concede – without being so willing to concede everything that the buyer knows they are on a roll.
It’s a difficult hand to play.