The Selling Company: Sequent, Inc., based in Columbus, Ohio, serves the small and mid-sized business market as a consulting and outsourcing company. It offers a full range of integrated HR support services such as a member-only health fund, government compliance, HR administration, payroll management, HR audits and assessments, talent recruiting and much more. In 2004, Sequent, Inc. developed a high-end, organizational change management consulting business serving Fortune 500 clients by hiring an industry consultant and combining her industry knowledge with Sequent’s HR consulting processes and skills. The subsidiary, Sequent HR Consulting (SHC), grew to over $5 million in revenues and was very profitable.
Why the company was sold: The shareholder group, which has been together for more than 22 years, wanted to sell the organization to monetize their investment.
Capital Alliance’s Performance: The client base of Sequent, Inc. and SHC were very diverse, therefore finding a buyer to purchase both operations would be difficult. Capital Alliance consulted with the shareholders and developed a plan to sell the consulting subsidiary, SHC, prior to the sale of Sequent, Inc. Capital Alliance negotiated favorable terms for the selling shareholders and continues to represent them in the sale of the parent company.
Terms of the Transaction: The selling shareholders received 100% cash and retained certain near liquid assets of SHC, along with minimal representation and warranty obligations in return for selling the operating assets of the company. These terms were critical to minimize any continuing obligations of Sequent, Inc. subsequent to the sale of SHC.
The Acquiring Company: Change 4 Growth is a new company formed by the former executive of SHC, and is expected to build off the solid reputation that SHC has earned in the marketplace for more than 10 years. Their clients include American Eagle, Safelite AutoGlass, Cardinal Health, LBrands, PetSmart, Chico’s and other successful Fortune 500 companies.
