Wayne Assaf, co-founder of data company, Microtronix.
Datacom, FPGA, and Design Engineering
Owned business for:
Reasons for selling:
To refocus on core competencies
Asking price and agreed price:
Can you tell us a bit about your businesss?
Our business basically comprises three businesses product groups. Our main thrust is the datacoms that we sell to telecoms and telcos internationally and we've been doing it since 1983.
The other product we have is about 10 years old and it's an FPGA - which means Field Programmable Gateway Arrays for devices. The third group we have is a design engineering group which supports the previous two groups.
Which business did you sell and why?
We contracted with BFS to sell my business, the FPGA group company, simply because it is outside of our mainstream and we wanted to completely refocus on our datacom markets.
How did you find the process for selling your business through BFS?
Good. We had nine enquiries and something like 109 views. One of our largest clients saw it and we're now in negotiations with it and we hope to conclude the deal in the next 90 days.
Did it take you time to come to a valuation amount that you were satisfied with?
If you have something that is worth something, you want to do a deal and you want to do a deal quickly and cleanly you should be looking at a minimum of one times revenue. It's easily justifiable, it's reasonable and it's good for a quick sale.
Have you ever bought a business?
Yes I have personally and professionally bought several businesses. The process is the same.
You have a list of priorities and criteria and those apply in reverse to any business that you're going to buy. Does this fit my needs? Is this what I want? Can I make it happen? Am I buying it fairly? And what are the complications in acquiring the business? What people are involved? And what can I bring to the party?
What is your advice for sellers?
First of all they have to be patient. They have to be very smart and they have to be very realistic in terms of what they want to receive. If they are not in sync with those three sets of criteria then they are going to have a huge problem.
Expectations for a seller are always very high. Sellers are very impatient for any number of reasons and they've got to temper that.
They have got to be smart about how they handle the business and what they're asking of a buyer. Every buyer has a different set of priorities.
Are you still trading well even in tough economic conditions?
Yes as we made a decision to go back to our core business. We have found a market in South America which is perfect for our technology. Economic times in the world today are the toughest I have ever seen in 30 years. People have to either sell or slim down their businesses or change direction to attract new markets.
Are conditions better in Canada than in the United States?
Absolutely. Canada for many, many years was the mouse sleeping in a single bed with an elephant and now, over the last 10 years the Canadian mouse now has its own bedroom. Canada is in wonderful shape, and so is Brazil.
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