Search Business in a Deplorable State - Essay Example

He has to find a business within the time period he has given himself. And finally, the time has to quickly adapt to this new role of his. He has to keep pace with the dynamics of the situation and keep increasing his learning curve.

Before the finalization of a deal, he should learn and everything about the business he is buying. He should totally not rely on instincts solely but also use concrete facts to affirm his choice. After his deal, he should first of all resolve those issues which are arising because of the labour union. He should embark upon a campaign to build relationships with his employees and customers.

Sharpe is falling short of the capital required to make the deal. Thus he is going for a leveraged buyout. The upside of this way of transacting is the availability of liquidity and flipping. However, the second benefit is cut by the original owner. In case the business does not go well, Tim will be in a whole lot of mess. The biggest culture change that he will experience is the unionized environment of his acquired company. Whereas previously in whichever company he has worked in there was zero tolerance for unionization. But in this company, the previous owner has received quite serious blows from the activities of the union. Tim is in a very tough situation and he needs the commitment of his employees to execute his turnaround strategy. If they do not comply with his orders then he would have much to lose as compared to his workers.   

If Press Alloy had been a subsidiary of large corporations then in its current situation, it would have been decided by the corporate CIO to put it out for divestiture or liquidate it. Tim might have received a comparatively lower price because the people who are dissecting Press Alloy from the parent company are not looking to sell it at a profit. These people are happy with whatever they can muster. Their focus is to minimize the parent company’s losses arising due to Press Alloy’s unprofitable operations. The corporate guy responsible for the deal would have a minimum price to extract, whereas the original entrepreneur would be pricing the company according to the company’s earning potential, thereby shifting the paradigm of the entire negotiation process.